UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549

                            FORM 10-K/A
                          Amendment No. 1

(Mark One)
 X   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
---  EXCHANGE ACT OF 1934


For the fiscal year ended December 31, 2005

                               OR

     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
---  SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to __________

                 Commission File Number 0-14690

                    WERNER ENTERPRISES, INC.
     (Exact name of registrant as specified in its charter)

NEBRASKA                                              47-0648386
(State or other jurisdiction of                 (I.R.S. Employer
incorporation or organization)               Identification No.)


14507 FRONTIER ROAD                                   68145-0308
POST OFFICE BOX 45308                                 (Zip code)
OMAHA, NEBRASKA
(Address of principal executive offices)

Registrant's telephone number, including area code: (402) 895-6640


Securities registered pursuant to Section 12(b) of the Act:  NONE
   Securities registered pursuant to Section 12(g) of the Act:
                  COMMON STOCK, $.01 PAR VALUE

Indicate by check mark if the registrant is a well-known seasoned
issuer,  as  defined  in  Rule 405   of   the   Securities   Act.
YES X NO
   ---  ---

Indicate by check mark if the registrant is not required to  file
reports  pursuant  to  Section  13  or  Section 15(d) of the Act.
YES   NO X
   ---  ---

Indicate  by check mark whether the registrant (1) has filed  all
reports  required  to be filed by Section  13  or  15(d)  of  the
Securities  Exchange Act of 1934 during the preceding  12  months
(or  for such shorter period that the registrant was required  to
file  such  reports),  and (2) has been subject  to  such  filing
requirements for the past 90 days.  YES X NO
                                       ---  ---

Indicate  by  check  mark  if  disclosure  of  delinquent  filers
pursuant  to Item 405 of Regulation S-K is not contained  herein,
and  will  not  be  contained, to the best  of  the  registrant's
knowledge,   in   definitive  proxy  or  information   statements
incorporated by reference in Part III of this Form  10-K  or  any
amendment to this Form 10-K. X
                            ---

Indicate  by  check  mark  whether  the  registrant  is  a  large
accelerated  filer,  an accelerated filer, or  a  non-accelerated
filer (as defined in Rule 12b-2 of the Act).

Large accelerated filer X  Accelerated filer    Non-accelerated filer
                       ---                  ---                      ---

Indicate by check mark whether the registrant is a shell  company
(as defined in Rule 12b-2 of the Act). YES   NO X
                                          ---  ---

The  aggregate  market value of the common equity  held  by  non-
affiliates  of  the Registrant (assuming for these purposes  that
all  executive  officers and Directors are  "affiliates"  of  the
Registrant)  as of June 30, 2005, the last business  day  of  the
Registrant's  most recently completed second fiscal quarter,  was
approximately $1.004 billion (based on the  closing sale price of
the  Registrant's  Common  Stock  on  that  date  as  reported by
Nasdaq).

As  of  February  9, 2006, 79,764,809 shares  of the registrant's
common stock were outstanding.

               DOCUMENTS INCORPORATED BY REFERENCE

Portions  of  the Proxy Statement of Registrant  for  the  Annual
Meeting  of Stockholders to be held May 9, 2006, are incorporated
in Part III of this report.



                       EXPLANATORY NOTE

  This  Amendment No. 1 on Form 10-K/A ("Amendment  No.  1")
to  the  Annual  Report on Form 10-K of Werner  Enterprises,
Inc. (the "Company") for the fiscal year ended December  31,
2005,  filed with the Securities and Exchange Commission  on
February  14, 2006 (the "Original Report"), is  being  filed
solely to correct omissions and certain typographical errors
on  the  cover page that arose in the process of  converting
the  Original  Report to an electronic format  suitable  for
filing on the Commission's EDGAR system.  In the EDGAR-filed
version  of  the Original Report, all check marks indicating
the  Company's  responses to items on the  cover  page  were
inadvertently omitted, and the appropriate boxes are checked
on  the  amended cover page.  Additionally, the  Company  is
making certain non-substantive corrections appearing on  the
cover  page  including  the  deletion  of  the  blank  lines
immediately  preceding  the  references  to  $1.004  billion
market  value  of  the common equity and  79,764,809  shares
outstanding  in the two paragraphs preceding the  "DOCUMENTS
INCORPORATED BY REFERENCE" section. The dollar amount of the
market  value  of  the common equity and  number  of  shares
outstanding  are  correct.  Further, the date  of  "February
109,  2006"  should  have  been  "February  9,  2006."  This
Amendment  No.  1  revises the cover page  of  the  Original
Report to correct these items. In connection with the filing
of  this  Amendment No. 1, the Company also is including  as
exhibits certain currently dated certifications of its Chief
Executive  Officer and Chief Financial Officer.  The Exhibit
Index on page 52 has been revised to reflect the addition of
these exhibits.

  For  convenience and ease of reference, this Amendment No.
1  sets  forth  the annual report in its entirety  with  the
applicable  changes. This Amendment No. 1 only reflects  the
changes  discussed  above, and does not  amend,  update,  or
change  any  other  items or disclosures  contained  in  the
Original Report.



                        TABLE OF CONTENTS


                                                                    Page
                                                                    ----

                             PART I

Item 1.  Business                                                     1
Item 1A. Risk Factors                                                 6
Item 1B. Unresolved Staff Comments                                    8
Item 2.  Properties                                                   8
Item 3.  Legal Proceedings                                            9
Item 4.  Submission of Matters to a Vote of Security Holders         10

                             PART II

Item 5.  Market for Registrant's Common Equity, Related Stockholder
         Matters and Issuer Purchases of Equity Securities           11
Item 6.  Selected Financial Data                                     12
Item 7.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations                                   12
Item 7A. Quantitative and Qualitative Disclosures about Market Risk  26
Item 8.  Financial Statements and Supplementary Data                 28
Item 9.  Changes in and Disagreements with Accountants on Accounting
         and Financial Disclosure                                    45
Item 9A. Controls and Procedures                                     45
Item 9B. Other Information                                           47

                            PART III

Item 10. Directors and Executive Officers of the Registrant          47
Item 11. Executive Compensation                                      48
Item 12. Security Ownership of Certain Beneficial Owners and
         Management                                                  48
Item 13. Certain Relationships and Related Transactions              48
Item 14. Principal Accountant Fees and Services                      48

                             PART IV

Item 15. Exhibits and Financial Statement Schedules                  49



                             PART I

ITEM 1.   BUSINESS

General

     Werner  Enterprises, Inc. ("Werner" or the "Company")  is  a
transportation  company engaged primarily  in  hauling  truckload
shipments   of   general  commodities  in  both  interstate   and
intrastate  commerce  as  well as providing  logistics  services.
Werner  is  one  of the five largest truckload  carriers  in  the
United States based on total operating revenues and maintains its
headquarters in Omaha,  Nebraska, near the  geographic center  of
its service  area.  Werner  was  founded in  1956 by Chairman and
Chief Executive  Officer, Clarence  L.  Werner, who  started  the
business with one truck at the age of 19 and was incorporated  in
the state of Nebraska on September 14, 1982. Werner completed its
initial public offering in  June 1986 with a  fleet of 632 trucks
as of February 28, 1986.  Werner ended 2005 with a fleet of 8,750
trucks, of  which 7,920  were owned  by the  Company and 830 were
owned and operated by owner-operators (independent contractors).

     The  Company  operates throughout the 48  contiguous  states
pursuant  to  operating  authority,  both  common  and  contract,
granted by the United States Department of Transportation ("DOT")
and  pursuant to intrastate authority granted by various  states.
The Company also has authority to operate in the ten provinces of
Canada and provides through trailer service in and out of Mexico.
The principal types of freight transported by the Company include
retail   store   merchandise,  consumer  products,   manufactured
products,  and  grocery products.  The Company's emphasis  is  to
transport   consumer   nondurable   products   that   ship   more
consistently  throughout the year and throughout changes  in  the
economy.   The  Company has two reportable segments  -  Truckload
Transportation  Services  and Value  Added  Services.   Financial
information regarding these segments and the Company's geographic
areas  can  be  found  in  the  Notes to  Consolidated  Financial
Statements under Item 8 of this Form 10-K.

Marketing and Operations

     Werner's business philosophy is to provide superior  on-time
service  to  its customers at a competitive cost.  To  accomplish
this,  Werner  operates  premium, modern tractors  and  trailers.
This  equipment  has  a lower frequency of breakdowns  and  helps
attract  and  retain qualified drivers.  Werner  has  continually
developed technology to improve service to customers and  improve
retention of drivers.  Werner focuses on shippers that value  the
broad   geographic  coverage,  equipment  capacity,   technology,
customized  services,  and flexibility available  from  a  large,
financially-stable  carrier.  These shippers are  generally  less
sensitive  to  rate  levels, preferring  to  have  their  freight
handled  by  a  few  core carriers with whom they  can  establish
service-based, long-term relationships.

     Werner  operates  in the truckload segment of  the  trucking
industry.    Within  the  truckload  segment,   Werner   provides
specialized  services to customers based on their  trailer  needs
(van,  flatbed, temperature-controlled), geographic area  (medium
to  long  haul throughout the 48 contiguous states,  Mexico,  and
Canada;   regional),    time-sensitive    nature   of   shipments
(expedited),  or  conversion  of  their  private  fleet to Werner
(dedicated).  Beginning  the  latter  part  of  2003, the Company
expanded  its  brokerage,  intermodal,  and   multimodal  service
offerings by adding senior management and developing new computer
systems.  Trucking revenues accounted for 88% of total  revenues,
and   non-trucking   and  other   operating  revenues,  primarily
brokerage revenues, accounted for 12% of total revenues in  2005.
Werner's  Value  Added  Services  ("VAS")  division  manages  the
transportation  and   logistics   requirements   for   individual
customers.   This  includes   truck   brokerage,   transportation
routing, transportation mode selection,  intermodal,  multimodal,
transloading,  and  other  services.  Value  Added  Services is a
non-asset-based business that is highly dependent on  information
systems, qualified employees, and  the  services  of  third-party
capacity  providers.   Compared   to  trucking  operations  which
require  a   significant  capital   equipment  investment,  VAS's
operating margin is lower  and return on  assets is substantially
higher.  Revenues generated  by services accounting for more than
10% of consolidated  revenues,

                                1


consisting  of Truckload  Transportation Services and Value Added
Services, for the last three  years can be  found under Item 7 of
this Form 10-K.

     Werner  has a diversified freight base and is not  dependent
on  a  small  group  of customers or a specific  industry  for  a
majority  of its freight.  During 2005, the Company's largest  5,
10,  25, and 50 customers comprised 24%, 36%, 54%, and 69% of the
Company's   revenues,   respectively.   The   Company's   largest
customer,  Dollar  General, accounted for 10%  of  the  Company's
revenues  in 2005, of which approximately two-thirds is dedicated
fleet  business  and  the  remainder  is primarily VAS.  No other
customer exceeded 5% of revenues in 2005.  By industry group, the
Company's  top  50  customers  consist of 45% retail and consumer
products, 23% grocery products, 22% manufacturing/industrial, and
10%  logistics and  other.  Many  of our  non-dedicated  customer
contracts are cancelable on 30 days notice, which is standard  in
the  trucking  industry.  Most  dedicated  customer contracts are
cancelable on 90 days  notice following  the  expiration  of  the
initial term of the contract.

     Virtually   all   of  Werner's  company  and  owner-operator
tractors  are  equipped  with  satellite  communications  devices
manufactured by Qualcomm that enable the Company and  drivers  to
conduct  two-way  communication using standardized  and  freeform
messages.    This  satellite  technology,  installed  in   trucks
beginning  in 1992, also enables the Company to plan and  monitor
the progress of shipments.  The Company obtains specific data  on
the  location of all trucks in the fleet at least every  hour  of
every  day. Using the real-time data obtained from the  satellite
devices,  Werner  has developed advanced application  systems  to
improve  customer  service and driver service. Examples  of  such
application   systems  include  (1)  the  Company's   proprietary
Paperless Log System to electronically preplan the assignment  of
shipments  to drivers based on real-time available driving  hours
and  to  automatically keep track of truck movement and  drivers'
hours of service, (2) software which preplans shipments that  can
be  swapped  by drivers enroute to meet driver home  time  needs,
without  compromising on-time delivery schedules,  (3)  automated
"possible  late  load"  tracking  which  informs  the  operations
department  of  trucks  that  may be operating  behind  schedule,
thereby allowing the Company to take preventive measures to avoid
a   late  delivery,  and  (4)  automated  engine  diagnostics  to
continually monitor mechanical fault tolerances.  In  June  1998,
Werner became the first, and only, trucking company in the United
States  to  receive  authorization from the DOT,  under  a  pilot
program,  to use a global positioning system based paperless  log
system in place of the paper logbooks traditionally used by truck
drivers  to track their daily work activities.  On September  21,
2004,  the  DOT's  Federal  Motor Carrier  Safety  Administration
("FMCSA")  agency  approved  the  Company's  exemption  for   its
paperless  log system that moves this exemption from  the  FMCSA-
approved pilot program to permanent status.  The exemption is  to
be renewed every two years.

Seasonality

     In the trucking industry, revenues generally show a seasonal
pattern  as some customers reduce shipments during and after  the
winter  holiday  season.  The Company's operating  expenses  have
historically  been higher in the winter months due  primarily  to
decreased fuel efficiency, increased maintenance costs of revenue
equipment  in colder weather, and increased insurance and  claims
costs  due  to  adverse winter weather conditions.   The  Company
attempts  to  minimize  the  impact of  seasonality  through  its
marketing  program  that seeks additional  freight  from  certain
customers during traditionally slower shipping periods.   Revenue
can  also be affected by bad weather and holidays, since  revenue
is directly related to available working days of shippers.

Employees and Owner-Operator Drivers

     As  of  December  31,  2005,  the  Company  employed  10,792
drivers,  986  mechanics and maintenance personnel, 1,687  office
personnel for the trucking operation, and 257 personnel  for  the
VAS  and other non-trucking operations.  The Company also had 830
contracts with owner-operators for services that provide  both  a
tractor  and a qualified driver or drivers. None of the Company's
U.S.  or  Canadian  employees  are represented  by  a  collective
bargaining unit, and the Company considers relations with all  of
its employees to be good.

                                2


     The   Company  recognizes   that  its   professional  driver
workforce  is one of its most valuable assets.  Most of  Werner's
drivers  are  compensated based upon miles driven.  For  company-
employed drivers, the rate per mile generally increases with  the
drivers' length of service. Additional compensation may be earned
through  a  mileage bonus, an annual achievement bonus,  and  for
extra  work  associated  with their job (loading  and  unloading,
extra stops, and shorter mileage trips, for example).

     At  times,  there are  shortages of drivers in the  trucking
industry.   The number of qualified drivers in the  industry  has
not  kept  pace  with freight growth because of  changes  in  the
demographic  composition of the workforce,  alternative  jobs  to
truck driving which become available in an improving economy, and
individual  drivers' desire to be home more  often.    In  recent
months,  the  already  challenging  market  for  recruiting   and
retaining  drivers has become even more difficult.   The  Company
anticipates that the competition for drivers will continue to  be
very high and cannot predict whether it will experience shortages
in the future.  If such a shortage were to occur and increases in
driver  pay rates became necessary to attract and retain drivers,
the  Company's results of operations would be negatively impacted
to  the extent that corresponding freight rate increases were not
obtained.

     The  Company also  recognizes that carefully selected owner-
operators   complement  its  company-employed   drivers.   Owner-
operators  are  independent contractors  that  supply  their  own
tractor  and  driver  and  are responsible  for  their  operating
expenses.  Because  owner-operators provide their  own  tractors,
less  financial  capital  is  required  from  the Company.  Also,
owner-operators  provide  the  Company  with  another  source  of
drivers  to  support  its fleet. The Company intends to  continue
its  emphasis on recruiting owner-operators, as well  as  company
drivers.   However,  it  has continued to be  difficult  for  the
Company  and  the  industry to recruit and retain owner-operators
over  the  past  few years due to several factors including  high
fuel  prices,  tightening of equipment financing  standards,  and
declining values for older used trucks.

Revenue Equipment

     As  of  December  31, 2005,  Werner operated  7,920  company
tractors  and  had  contracts for 830 tractors  owned  by  owner-
operators.   The   company   tractors   were   manufactured    by
Freightliner, a subsidiary of DaimlerChrysler, and Peterbilt  and
Kenworth,  divisions  of  PACCAR.  This  standardization  of  the
company   tractor   fleet  decreases  downtime   by   simplifying
maintenance.  The Company adheres to a comprehensive  maintenance
program  for both tractors and trailers.  Owner-operator tractors
are  inspected prior to acceptance by the Company for  compliance
with  operational and safety requirements of the Company and  the
DOT.  These tractors are then periodically inspected, similar  to
company  tractors, to monitor continued compliance.  The  vehicle
speed  of  company-owned trucks is regulated to a maximum  of  65
miles per hour to improve safety and fuel efficiency.

     The  Company operated  25,210 trailers at December 31, 2005:
23,320 dry vans; 621 flatbeds; and 1,269  temperature-controlled.
Most of  the  Company's  trailers  were  manufactured  by  Wabash
National  Corporation.  As  of  December  31,  2005,  98%  of the
Company's  fleet  of  dry  van  trailers  consisted  of   53-foot
trailers, and  98%  consisted  of  aluminum  plate  or  composite
(duraplate) trailers.  Other trailer lengths such as 48-foot  and
57-foot are also provided by the Company to meet the  specialized
needs of certain customers.

     Effective  October  1, 2002, all  newly  manufactured  truck
engines  must  comply  with phase 1 of the  new  engine  emission
standards   mandated  by  the  Environmental  Protection   Agency
("EPA").  All truck engines manufactured prior to October 1, 2002
are  not  subject to these new standards.  To delay the cost  and
business  risk of buying these new truck engines with  inadequate
testing  time  prior to the October 1, 2002 effective  date,  the
Company significantly increased the purchase of trucks with  pre-
October 2002 engines.  As of December 31, 2005, approximately 89%
of  the  company-owned truck fleet consisted of trucks  with  the
post-October  2002  engines.   The  Company  has  experienced  an
approximate  5%  reduction  in  fuel  efficiency  to  date,   and
increased depreciation expense due to the higher cost of the  new
engines.   The  average  age  of the  Company's  truck  fleet  at
December  31,  2005 is 1.23 years.  A new set of  more  stringent
emissions standards mandated by the EPA will become effective for
newly manufactured trucks beginning in January 2007 (phase 2) and

                                3


January  2010  (phase 3).  The Company expects that  the  engines
produced under the 2007 standards will be less fuel-efficient and
have  a  higher cost than the current engines.  During 2005,  the
Company purchased significantly more trucks than normal to reduce
the  average age of its fleet.  The Company's goal is to keep its
fleet as new as possible during 2006.

Fuel

     The  Company purchases approximately 95% of its fuel through
a  network  of  fuel  stops throughout the  United  States.   The
Company has negotiated discounted pricing based on certain volume
commitments  with these fuel stops. Bulk fueling  facilities  are
maintained at seven of the Company's terminals and four dedicated
fleet locations.

     Shortages of fuel, increases in fuel prices, or rationing of
petroleum  products can have a materially adverse effect  on  the
operations  and  profitability of  the  Company.   The  Company's
customer  fuel surcharge reimbursement programs have historically
enabled  the  Company to recover from its customers a significant
portion  of the higher fuel prices compared to normalized average
fuel  prices.  These fuel surcharges, which automatically  adjust
depending  on the Department of Energy ("DOE") weekly retail  on-
highway diesel fuel prices, enable the Company to recoup much  of
the higher cost of fuel when prices increase except for miles not
billable  to  customers,  out-of-route miles,  and  truck  engine
idling.    During   2005,   the  Company's   fuel   expense   and
reimbursements to owner-operator drivers for the higher  cost  of
fuel resulted in an additional cost of $137.1 million, while  the
Company  collected an additional $121.6 million in fuel surcharge
revenues to offset the fuel cost increase.  Conversely, when fuel
prices  decrease, fuel surcharges decrease. In addition, the  two
September 2005  hurricanes in  the  Gulf Coast  region  caused  a
shortage of refined product that escalated diesel fuel prices  at
the   same   time  that  crude  oil  prices  did   not   increase
significantly.   The  Company cannot predict  whether  high  fuel
prices  will continue to increase or will decrease in the  future
or  the  extent  to which fuel surcharges will  be  collected  to
offset such increases.  As of December 31, 2005, the Company  had
no  derivative  financial instruments to reduce its  exposure  to
fuel price fluctuations.

     The  Company  maintains  aboveground  and  underground  fuel
storage  tanks at most of its terminals.  Leakage  or  damage  to
these facilities could expose the Company to environmental clean-
up  costs.  The tanks are routinely inspected to help prevent and
detect such problems.

Regulation

     The  Company is a motor  carrier regulated by the  DOT,  the
Federal and Provincial Transportation Departments in Canada,  and
the  Secretary  of  Communication  and  Transportation ("SCT") in
Mexico.  The  DOT  generally  governs  matters   such  as  safety
requirements, registration to engage in motor carrier operations,
accounting    systems,    certain     mergers,    consolidations,
acquisitions,  and  periodic  financial  reporting.  The  Company
currently  has  a  satisfactory  DOT  safety rating, which is the
highest  available  rating.  A  conditional or unsatisfactory DOT
safety  rating  could  have  an adverse effect on the Company, as
some  of  the  Company's  contracts  with  customers   require  a
satisfactory rating.  Such  matters as  weight and  dimensions of
equipment  are  also subject to federal, state, and international
regulations.

     The  FMCSA  issued a final rule on April 24, 2003 that  made
several  changes  to the regulations that govern  truck  drivers'
hours  of service ("HOS").  These new federal regulations  became
effective on January 4, 2004.  On July 16, 2004, the U.S. Circuit
Court of Appeals for the District of Columbia rejected these  new
hours  of service rules for truck drivers that had been in  place
since  January  2004  because it said the  FMCSA  had  failed  to
address  the  impact  of the rules on the health  of  drivers  as
required by Congress. In addition, the judge's ruling noted other
areas of concern including the increase in driving hours from  10
hours  to  11 hours, the exception that allows drivers in  trucks
with sleeper berths to split their required rest periods, the new
rule  allowing drivers to reset their 70-hour clock  to  0  hours
after  34  consecutive hours off duty, and the  decision  by  the
FMCSA  not to require the use of electronic onboard recorders  to
monitor  driver compliance.  On September 30, 2004, the extension
of  the  Federal  highway bill signed into law by  the  President
extended  the  current hours of service rules  until  October  1,
2005,  when all truckload carriers became subject to revised  HOS
regulations.   The  only  significant change  from  the  previous
regulations  is  that a driver using the sleeper berth  provision

                                4


must  take at least eight consecutive hours in the sleeper  berth
during  their  ten  hours  off-duty.   Previously,  drivers  were
allowed  to  split their ten hour off-duty time  in  the  sleeper
berth into two periods, provided neither period was less than two
hours.    This  more  restrictive  sleeper  berth  provision   is
requiring some drivers to plan their time better and could have a
negative  impact  on mileage productivity.  The  greatest  impact
will be for those customers with multiple-stop shipments or those
shipments with pickup or delivery delays.

     The  Company  has  unlimited  authority  to   carry  general
commodities  in interstate commerce throughout the 48  contiguous
states.  The  Company  has  authority  to  carry  freight  on  an
intrastate   basis   in   43  states.    The   Federal   Aviation
Administration Authorization Act of 1994 (the "FAAA Act") amended
sections  of  the Interstate Commerce Act to prevent states  from
regulating  rates,  routes, or service of  motor  carriers  after
January 1, 1995.  The FAAA Act did not address state oversight of
motor  carrier  safety  and  financial  responsibility  or  state
taxation  of transportation.  If a carrier wishes to  operate  in
intrastate  commerce in a state where it did not previously  have
intrastate  authority, it must, in most cases,  still  apply  for
authority.

     The  Company's  operations are  subject to various  federal,
state,  and local environmental laws and regulations, implemented
principally  by  the  EPA and similar state regulatory  agencies,
governing the management of hazardous wastes, other discharge  of
pollutants  into the air and surface and underground waters,  and
the disposal of certain substances.  The Company does not believe
that  compliance with these regulations has a material effect  on
its capital expenditures, earnings, and competitive position.

     The  implementation  of  various  provisions  of  the  North
American Free Trade Agreement ("NAFTA") may alter the competitive
environment  for  shipping into and out of  Mexico.   It  is  not
possible  at  this time to predict when and to what  extent  that
impact will be felt by companies transporting goods into and  out
of  Mexico.  The Company does a substantial amount of business in
international freight shipments to and from the United States and
Mexico  (see  Note  8  "Segment  Information"  in  the  Notes  to
Consolidated Financial Statements under Item 8 of this Form 10-K)
and  is continuing to prepare for the various scenarios that  may
finally  result.  The Company believes it  is  one  of  the  five
largest  truckload  carriers in terms of the  volume  of  freight
shipments to and from the United States and Mexico.

Competition

     The  trucking industry  is highly competitive  and  includes
thousands of trucking companies.  It is estimated that the annual
revenue  of  domestic  trucking  amounts  to  approximately  $600
billion  per  year.   The Company has a small but  growing  share
(estimated  at approximately 1%) of the markets targeted  by  the
Company.   The  Company competes primarily with  other  truckload
carriers.  Logistics  companies,  railroads,  less-than-truckload
carriers, and private carriers also provide competition, but to a
much lesser degree.

     Competition for the freight  transported by the  Company  is
based primarily on service and efficiency and, to some degree, on
freight  rates alone.  Few other truckload carriers have  greater
financial resources, own more equipment, or carry a larger volume
of  freight  than the Company.  The Company is one  of  the  five
largest  carriers in the truckload transportation industry  based
on total operating revenues.

     Industry-wide  truck capacity  in the  truckload  sector  is
being   limited  due  to  a  number  of  factors.   An  extremely
challenging  driver  recruiting  market  is  causing  most  large
truckload  carriers  to limit their fleet additions.   There  are
continuing  cost  issues  with the engine  emission  changes  and
uncertainties  regarding the engines that will  be  required  for
newly  manufactured trucks beginning in January  2007.   Trucking
company failures in the last six years are continuing at  a  pace
higher than the previous fifteen years.  Many truckload carriers,
including  Werner,  slowed their fleet growth  in  the  last  six
years,  and some carriers have downsized their fleets to  improve
their operating margins and returns.

                                5


Internet Website

     The Company maintains a website where additional information
concerning  its  business  can be found.   The  address  of  that
website  is www.werner.com.  The Company makes available free  of
charge  on  its Internet website its annual report on Form  10-K,
quarterly reports on Form 10-Q, current reports on Form 8-K,  and
amendments  to  those  reports filed  or  furnished  pursuant  to
Section  13(a) or 15(d) of the Exchange Act as soon as reasonably
practicable  after  it  electronically files  or  furnishes  such
materials  to the SEC.   Information on the Company's website  is
not incorporated by reference into this annual report on Form 10-
K.

ITEM 1A.  RISK FACTORS

     The  following  risks  and uncertainties  may  cause  actual
results  to  differ  materially from  those  anticipated  in  the
forward-looking statements included in this Form 10-K:

The  Company's business is subject to overall economic conditions
that  could  have  a material adverse effect on  the  results  of
operations of the Company.
     The  Company  is  sensitive to changes in  overall  economic
conditions  that impact customer shipping volumes.   The  general
slowdown in the economy in 2001 and 2002 had a negative effect on
freight  volumes for truckload carriers, including  the  Company.
Beginning  in  2003  and  continuing  throughout  2005,   general
economic  improvements lead to improved freight demand.   As  the
unemployment   rate  increased  during  2001  and  2002,   driver
availability improved for the Company and the industry but became
more  difficult  beginning in fourth quarter 2003 and  continuing
through  2005.    Future economic conditions that may affect  the
Company include employment levels, business conditions, fuel  and
energy costs, interest rates, and tax rates.

Increases  in  fuel  prices and shortages  of  fuel  can  have  a
material  adverse  effect  on  the  results  of  operations   and
profitability of the Company.
     Fuel  prices  climbed  steadily  throughout  most  of  2005,
spiking  in  September and October 2005 due to the two hurricanes
that  struck  the  Gulf Coast region in September  2005.   Prices
declined  in November 2005 from the record high price  levels  in
October,  but the end-of-year  prices, excluding fuel taxes, were
still about 47% higher in 2005 than in 2004.  Shortages of  fuel,
increases  in fuel prices, or rationing of petroleum products can
have  a  materially   adverse  impact   on  the   operations  and
profitability  of  the  Company.  To  the extent that the Company
cannot  recover  the  higher  cost  of fuel through customer fuel
surcharges,  the  Company's financial results would be negatively
impacted.

Difficulty  in  recruiting  and  retaining  drivers  and   owner-
operators  could impact the Company's results of  operations  and
limit growth opportunities.
     At  times,  there  have been shortages  of  drivers  in  the
trucking  industry.   The  market for  recruiting  and  retaining
drivers  became  more  difficult  in  fourth  quarter  2003   and
continued throughout 2005.  During the last several years, it was
more  difficult to recruit and retain owner-operator drivers  due
to  challenging operating conditions, including high fuel prices.
The  Company anticipates that the competition for company drivers
and  owner-operator drivers will continue to be high  and  cannot
predict whether it will experience shortages in the future.  If a
shortage of company drivers and owner-operators were to occur and
increases in driver pay rates and owner-operator settlement rates
became  necessary  to  attract drivers and  owner-operators,  the
Company's  results of operations would be negatively impacted  to
the  extent  that corresponding freight rate increases  were  not
obtained.   Additionally, the Company expects  the  tight  driver
market  will make it very difficult to add truck capacity in  the
near future.

The  Company operates in a highly competitive industry, which may
limit growth opportunities and reduce profitability.
     The  trucking  industry is highly competitive  and  includes
thousands of trucking companies.  The Company estimates  the  ten
largest truckload carriers have about 12% of the approximate $150
billion  market  targeted by the Company.  This competition could
limit  the   Company's  growth   opportunities  and   reduce  its
profitability.   The  Company   competes  primarily   with  other
truckload carriers.  Logistics  companies,  railroads, less-than-
truckload   carriers,   and   private   carriers   also   provide

                                6


competition,  but  to a much lesser degree. Competition  for  the
freight  transported by the Company is based primarily on service
and efficiency and, to some degree, on freight rates alone.

The Company operates in a highly regulated industry.  Changes  in
existing   regulations  or  violations  of  existing  or   future
regulations  could have an adverse effect on the  operations  and
profitability of the Company.
     The  Company  is  regulated  by the  DOT,  the  Federal  and
Provincial   Transportation  Departments  in  Canada,   and   the
SCT  in  Mexico.  These  regulatory  authorities  establish broad
powers, generally governing  activities such as  authorization to
engage in motor carrier  operations, safety, financial reporting,
and other matters.  The Company may become subject to new or more
comprehensive  regulations  relating to  fuel  emissions,  driver
hours of service, or other issues mandated by  the DOT, EPA,  the
Federal  and  Provincial Transportation Departments in Canada, or
the SCT in Mexico.

     New hours of service regulations became effective October 1,
2005,   with  only  one  significant  change  from  the  previous
regulations.  The  Company cannot predict what rule  changes,  if
any,  might  result  in the future.  Any changes  could  have  an
adverse  effect  on  the  operations  and  profitability  of  the
Company.

     Effective  October  1, 2002, all  newly  manufactured  truck
engines  must comply with the engine emission standards  mandated
by  the  EPA.  As of December 31, 2005, approximately 89% of  the
company-owned truck fleet consisted of trucks with the new  post-
October 2002 engines.  The Company has experienced an approximate
5%   reduction   in  fuel  efficiency  to  date   and   increased
depreciation  expense due to the higher cost of the new  engines.
A  new set of more stringent emissions standards mandated by  the
EPA will become effective for newly manufactured trucks beginning
in January 2007.  The Company has already reduced the average age
of  its  truck  fleet  to  1.23 years in  advance  of  these  new
standards.  The  Company expects that the engines produced  under
the  2007 standards will be less fuel-efficient and have a higher
cost  than the current engines. The Company is unable to  predict
the  impact  these new regulations will have on  its  operations,
financial position, results of operations, and cash flows.

The  seasonal  pattern  generally  experienced  in  the  trucking
industry  may  affect  the  Company's  periodic  results   during
traditionally  slower  shipping periods  and  during  the  winter
months.
     The  Company's  business  is  modestly  seasonal  with  peak
freight  demand occurring generally in the months  of  September,
October,  and  November.   After the  Christmas  holiday  season,
during the remaining winter months, the Company's freight volumes
are typically lower as some customers have lower shipment levels.
The Company's operating expenses have historically been higher in
winter   months  primarily  due  to  decreased  fuel  efficiency,
increased  maintenance  costs  of  revenue  equipment  in  colder
weather, and increased insurance and claims costs due to  adverse
winter weather conditions.  The Company attempts to minimize  the
impact  of  seasonality through its marketing program by  seeking
additional  freight  from certain customers during  traditionally
slower  shipping periods.  Bad weather, holidays, and the  number
of business days during the period can also affect revenue, since
revenue  is  directly  related  to  available  working  days   of
shippers.

The  Company  depends  on  the services of  third-party  capacity
providers,  the availability of which could affect the  Company's
profitability and limit growth in its VAS division.
     The  Company's  VAS  division is  highly  dependent  on  the
services  of  third-party  capacity  providers,  including  other
truckload  carriers and railroads.  Many of those providers  face
the  same  economic  challenges as the  Company.   As  the  truck
capacity  market tightened during 2005, it became more  difficult
to  find  qualified truckload capacity to meet  customer  freight
needs.  The Company expects a tight truckload capacity market  in
2006   with   the   extremely  challenging  driver   market   and
historically  high  fuel  prices.  If  the Company were unable to
secure  the services of these third-party capacity providers, its
results of operations could be adversely affected.

Increases in the number of insurance claims, the cost per  claim,
or  the  costs  of insurance premiums could reduce the  Company's
earnings.
     The  Company  self-insures  for  a  significant  portion  of
liability  resulting  from  cargo  loss,  personal  injury,   and
property  damage  as  well  as workers'  compensation.   This  is
supplemented   by  premium  insurance  with  licensed   insurance
companies above the Company's self-insurance level for each  type
of  coverage.   To  the extent the Company were to  experience  a
significant increase in the number of claims, the cost per claim,
or  the costs of insurance premiums for coverage in excess of its

                                7


retention  amounts,  the  Company's operating  results  would  be
negatively affected.

Decreased  demand for the Company's used revenue equipment  could
result in lower unit sales, lower resale values, and lower  gains
on sales of assets.
     The  Company  is  sensitive  to changes  in  used  equipment
prices,   especially  tractors.   Because  of  truckload  carrier
concerns with new truck engines and lower industry production  of
new  trucks  over  the last several years, the  resale  value  of
Werner's  premium used trucks improved from the historically  low
values  of 2001.  The Company has been in the business of selling
its  Company-owned trucks since 1992, when it formed its  wholly-
owned subsidiary Fleet Truck Sales.  The Company currently has 17
Fleet  Truck Sales locations throughout the United States.  Gains
on  sales  of  assets  are  reflected as  a  reduction  of  other
operating expenses in the Company's income statement and amounted
to gains of $11.0 million in 2005, $9.3 million in 2004, and $6.9
million in 2003.

The Company relies on the services of key personnel, the loss  of
which could impact the future success of the Company.
     The  Company  is  highly dependent on the  services  of  key
personnel  including  Clarence  L.  Werner  and  other  executive
officers.   Although the Company believes it has  an  experienced
and  highly qualified management group, the loss of the  services
of  these executive officers could have a material adverse impact
on the Company and its future profitability.

Difficulty  in  obtaining goods and services from  the  Company's
vendors  and  suppliers  could  adversely  affect  the  Company's
business.
    The  Company is dependent  on its vendors and suppliers.  The
Company  believes it has good relationships with its vendors  and
that  it is generally able to obtain attractive pricing and other
terms  from  vendors  and suppliers.  If  the  Company  fails  to
maintain good relationships with its vendors and suppliers or  if
its   vendors  and  suppliers  experience  significant  financial
problems,  the Company could face difficulty in obtaining  needed
goods and services because of interruptions of production or  for
other   reasons,  which  could  adversely  affect  the  Company's
business.

The  Company uses its information systems extensively for day-to-
day  operations,  and service disruptions could have  an  adverse
impact on the Company's operations.
     The  efficient operation of the Company's business is highly
dependent  on  its  information systems.  Much of  the  Company's
software  has been developed internally or by adapting  purchased
software  applications to the Company's needs.  The  Company  has
purchased  redundant  computer  hardware  systems and has its own
off-site disaster recovery facility approximately ten miles  from
the Company's  offices  to use in  the event  of a disaster.  The
Company has taken these steps to reduce the risk of disruption to
its business operation if a disaster were to occur.

     Caution  should  be taken not  to place  undue  reliance  on
forward-looking  statements  made herein,  since  the  statements
speak  only as of the date they are made.  The Company undertakes
no  obligation to publicly release any revisions to any  forward-
looking   statements  contained  herein  to  reflect  events   or
circumstances  after the date of this report or  to  reflect  the
occurrence of unanticipated events.

ITEM 1B.  UNRESOLVED STAFF COMMENTS

     The Company has  received no written comments regarding  its
periodic or current reports from the staff of the Securities  and
Exchange  Commission that were issued 180 days or more  preceding
the end of its 2005 fiscal year and that remain unresolved.

ITEM 2.   PROPERTIES

     Werner's headquarters is located nearby Interstate  80  just
west of Omaha, Nebraska, on approximately 195 acres, 105 of which
are held for future expansion.  The Company's headquarters office
building  includes a computer center, drivers'  lounge  areas,  a
drivers' orientation section, a cafeteria, a cargo salvage store,
and  a Company store.  The Omaha headquarters also consists of  a
driver  training  facility and equipment maintenance  and  repair
facilities   containing   a  central   parts   warehouse,   frame

                                8


straightening  and  alignment machine,  truck  and  trailer  wash
areas,  equipment  safety  lanes, body  shops  for  tractors  and
trailers,  a  paint  booth,  and a reclaim center.  The Company's
headquarters  facilities   have  suitable   space  available   to
accommodate planned needs for the next 3 to 5 years.

     The Company also has several terminals throughout the United
States, consisting of office and/or maintenance facilities.   The
Company's terminal locations are described below:




Location                 Owned or Leased           Description
--------                 ---------------           -----------
                                             
Omaha, Nebraska          Owned                     Corporate headquarters,
                                                    maintenance
Omaha, Nebraska          Owned                     Disaster recovery,
                                                    warehouse
Phoenix, Arizona         Owned                     Office, maintenance
Fontana, California      Owned                     Office, maintenance
Denver, Colorado         Owned                     Office, maintenance
Atlanta, Georgia         Owned                     Office, maintenance
Indianapolis, Indiana    Leased                    Office, maintenance
Springfield, Ohio        Owned                     Office, maintenance
Allentown, Pennsylvania  Leased                    Office, maintenance
Dallas, Texas            Owned                     Office, maintenance
Laredo, Texas            Owned                     Office, maintenance,
                                                    transloading
Lakeland, Florida        Leased                    Office
Portland, Oregon         Leased                    Office, maintenance
Ardmore, Oklahoma        Leased                    Maintenance
Indianola, Mississippi   Leased                    Maintenance
Scottsville, Kentucky    Leased                    Maintenance
Fulton, Missouri         Leased                    Maintenance
Tomah, Wisconsin         Leased                    Maintenance
Newbern, Tennessee       Leased                    Maintenance
Chicago, Illinois        Leased                    Maintenance



     The Company leases approximately 60 small sales  offices and
trailer  parking  yards  in   various  locations  throughout  the
country,  owns  a  96-room motel   located  near  the   Company's
headquarters, owns four low-income housing apartment complexes in
the  Omaha  area,  has  50% ownership in  a  125,000  square-foot
warehouse located near the Company's headquarters, and  has  one-
third  ownership  in  a 71-room motel near the  Company's  Dallas
terminal.   Currently, the Company has 17 locations in its  Fleet
Truck   Sales  network.   Fleet  Truck  Sales,  a  wholly   owned
subsidiary,  is one of the largest domestic class 8  truck  sales
entities  in  the  U.S. and sells the Company's used  trucks  and
trailers.

ITEM 3.   LEGAL PROCEEDINGS

     The Company  is a party to routine litigation incidental  to
its  business,  primarily involving claims for  personal  injury,
property  damage,  and  workers'  compensation  incurred  in  the
transportation  of freight.  The Company has maintained  a  self-
insurance  program with a qualified department of Risk Management
professionals  since 1988.  These employees manage the  Company's
property  damage,  cargo,  liability, and  workers'  compensation
claims.  The Company's self-insurance reserves are reviewed by an
actuary every six months.

                                9


     The Company has been  responsible for liability claims up to
$500,000,  plus  administrative  expenses,  for  each  occurrence
involving  personal  injury or property damage  since  August  1,
1992.   For the policy year beginning August 1, 2004, the Company
increased  its  self-insured retention  ("SIR")  amount  to  $2.0
million  per  occurrence.  The Company is  also  responsible  for
varying  annual  aggregate amounts of  liability  for  claims  in
excess  of  the  self-insured  retention.   The  following  table
reflects the self-insured retention levels and aggregate  amounts
of liability for personal injury and property damage claims since
August 1, 2002:



                                                       Primary Coverage
      Coverage Period             Primary Coverage      SIR/deductible
------------------------------    ----------------     ----------------
                                                 
August 1, 2002 - July 31, 2003    $3.0 million         $500,000 (1)
August 1, 2003 - July 31, 2004    $3.0 million         $500,000 (2)
August 1, 2004 - July 31, 2005    $5.0 million         $2.0 million (3)
August 1, 2005 - July 31, 2006    $5.0 million         $2.0 million (4)



(1)  Subject to an additional  $1.5 million aggregate in the $0.5
to  $1.0 million layer, a $1.0  million aggregate in the $1.0  to
$2.0  million layer, no aggregate  (i.e., fully insured)  in  the
$2.0 to $3.0 million layer, and  self-insured in the $3.0 to $5.0
million layer.

(2)  Subject to an  additional $1.5 million aggregate in the $0.5
to  $1.0 million layer,  a $1.0 million aggregate in the $1.0  to
$2.0  million layer, no  aggregate (i.e., fully insured)  in  the
$2.0 to $3.0 million layer,  a $6.0 million aggregate in the $3.0
to  $5.0 million layer, and  a $5.0 million aggregate in the $5.0
to $10.0 million layer.

(3)  Subject to an additional $3.0  million aggregate in the $2.0
to $3.0 million layer, no aggregate  (i.e., fully insured) in the
$3.0 to $5.0 million layer, and a  $5.0 million aggregate in  the
$5.0 to $10.0 million layer.

(4)  Subject to an additional  $2.0 million aggregate in the $2.0
to $3.0 million layer, no  aggregate (i.e., fully insured) in the
$3.0 to $5.0 million layer,  and a $5.0 million aggregate in  the
$5.0 to $10.0 million layer.

     The   Company  has   assumed   responsibility  for  workers'
compensation  up  to  $1.0  million  per  claim,  subject  to  an
additional $1.0 million aggregate for claims between $1.0 million
and  $2.0  million,  maintains  a $27.5  million  bond,  and  has
obtained insurance for individual claims above $1.0 million.

     The  Company's  primary   insurance  covers  the   range  of
liability  where  the  Company  expects  most  claims  to  occur.
Liability  claims  substantially in excess  of  coverage  amounts
listed  in  the  table above, if they occur,  are  covered  under
premium-based  policies  with reputable  insurance  companies  to
coverage levels that management considers adequate.  The  Company
is   also  responsible  for  administrative  expenses  for   each
occurrence  involving  personal injury or property  damage.   See
also   Note  1  "Insurance  and  Claims  Accruals"  and  Note   6
"Commitments  and  Contingencies" in the  Notes  to  Consolidated
Financial Statements under Item 8 of this Form 10-K.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     During the fourth quarter of 2005, no matters were submitted
to a vote of security holders.

                                10


                             PART II

ITEM 5.   MARKET   FOR   REGISTRANT'S   COMMON   EQUITY,  RELATED
          STOCKHOLDER  MATTERS  AND  ISSUER  PURCHASES  OF EQUITY
          SECURITIES

Price Range of Common Stock

     The  Company's  common stock  trades on the Nasdaq  National
Market  tier of The Nasdaq Stock Market under the symbol  "WERN".
The  following  table sets forth for the quarters  indicated  the
high  and  low bid information per share of the Company's  common
stock  quoted  on  the Nasdaq National Market and  the  Company's
dividends declared per common share from January 1, 2004, through
December 31, 2005.



                                                   Dividends
                                                 Declared Per
                            High       Low       Common Share
                           ------     ------     ------------
                                            
         2005
         Quarter ended:
          March 31         $22.91     $19.25         $.035
          June 30           19.91      17.68          .040
          September 30      20.62      15.78          .040
          December 31       20.96      16.34          .040



                                                   Dividends
                                                 Declared Per
                            High       Low       Common Share
                           ------     ------     ------------
         2004
         Quarter ended:
          March 31         $20.00     $17.65         $.025
          June 30           21.11      17.76          .035
          September 30      21.19      17.55          .035
          December 31       23.24      18.68          .035



     As  of February 9, 2006, the Company's common stock was held
by  227  stockholders   of   record   and   approximately   8,200
stockholders  through  nominee  or  street   name  accounts  with
brokers.  The  high and low bid prices per share of the Company's
common stock in the Nasdaq National Market as of February 9, 2006
were $21.17 and $20.72, respectively.

Dividend Policy

     The  Company has been  paying cash dividends on  its  common
stock  following  each of its quarters since the  fiscal  quarter
ended  May  31, 1987. The Company currently intends  to  continue
payment  of dividends on a quarterly basis and does not currently
anticipate  any restrictions on its future ability  to  pay  such
dividends. However, no assurance can be given that dividends will
be  paid in the future since they are dependent on earnings,  the
financial condition of the Company, and other factors.

Equity Compensation Plan Information

     For information  on the Company's equity compensation plans,
please   refer  to  Item  12,  "Security  Ownership  of   Certain
Beneficial Owners and Management".

                                11


Purchases  of  Equity  Securities by the  Issuer  and  Affiliated
Purchasers

     On  November 24, 2003, the Company announced that its  Board
of   Directors   approved  an  authorization  for  common   stock
repurchases  of 3,965,838 shares.  As of December 31,  2005,  the
Company   had   purchased  257,038  shares   pursuant   to   this
authorization  and had 3,708,800 shares remaining  available  for
repurchase.   The Company may purchase shares from time  to  time
depending   on   market,  economic,  and  other   factors.    The
authorization  will  continue until withdrawn  by  the  Board  of
Directors.

     The  Company  did not repurchase any shares of common  stock
during the fourth quarter of 2005.

ITEM 6.   SELECTED FINANCIAL DATA

     The  following selected  financial data should  be  read  in
conjunction with the consolidated financial statements and  notes
under Item 8 of this Form 10-K.




(In thousands, except per share amounts)
                                            2005       2004       2003       2002       2001
                                         ---------- ---------- ---------- ---------- ----------
                                                                      
Operating revenues                       $1,971,847 $1,678,043 $1,457,766 $1,341,456 $1,270,519
Net income                                   98,534     87,310     73,727     61,627     47,744
Diluted earnings per share*                    1.22       1.08       0.90       0.76       0.60
Cash dividends declared per share*             .155       .130       .090       .064       .060
Return on average stockholders'
  equity (1)                                   12.1%      11.9%      10.9%      10.0%       8.5%
Return on average total assets (2)              7.6%       7.5%       6.7%       6.1%       5.1%
Operating ratio (consolidated) (3)             91.7%      91.6%      91.9%      92.6%      93.8%
Book value per share* (4)                     10.86       9.76       8.90       8.12       7.42
Total assets                              1,385,762  1,225,775  1,121,527  1,062,878    964,014
Total debt                                   60,000          -          -     20,000     50,000
Stockholders' equity                        862,451    773,169    709,111    647,643    590,049



*After giving retroactive effect for the September 30, 2003 five-
for-four stock split and the March 14, 2002 four-for-three  stock
split  (all years presented).
(1) Net income expressed as a percentage of average stockholders'
equity.   Return  on  equity  is a  measure  of  a  corporation's
profitability relative to recorded shareholder investment.
(2) Net income expressed as a percentage of average total assets.
Return  on  assets is a measure of a corporation's  profitability
relative to recorded assets.
(3)  Operating  expenses expressed as a percentage  of  operating
revenues.   Operating ratio is a common measure in  the  trucking
industry used to evaluate profitability.
(4) Stockholders' equity divided by common shares outstanding  as
of  the  end  of the period.  Book value per share indicates  the
dollar value remaining for common shareholders if all assets were
liquidated and all debts were paid at the recorded amounts.

ITEM 7.   MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF   FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS

     This  report  contains historical information,  as  well  as
forward-looking   statements  that  are  based   on   information
currently  available to the Company's management.   The  forward-
looking  statements in this report, including those made in  Item
7,  "Management's Discussion and Analysis of Financial  Condition
and  Results of Operations," are made pursuant to the safe harbor
provisions  of  the Private Securities Litigation Reform  Act  of
1995.   The  Company  believes the assumptions  underlying  these
forward-looking  statements are reasonable based  on  information
currently  available;  however, any of the assumptions  could  be
inaccurate,  and therefore, actual results may differ  materially
from  those  anticipated in the forward-looking statements  as  a
result  of certain risks and uncertainties.  These risks include,
but  are  not  limited  to,  those discussed  in  Item  1A  "Risk
Factors".  Caution should be taken not to place undue reliance on
forward-looking  statements  made herein,  since  the  statements
speak  only as of the date they are made.  The Company undertakes
no  obligation to publicly release any revisions to any  forward-
looking   statements  contained  herein  to  reflect  events   or
circumstances  after the date of this report or  to  reflect  the
occurrence of unanticipated events.

                                12


Overview:

     The Company operates in the truckload sector of the trucking
industry,  with  a  focus  on  transporting  consumer  nondurable
products  that ship more consistently throughout the  year.   The
Company's  success  depends on its ability to efficiently  manage
its  resources  in  the delivery of truckload transportation  and
logistics services to its customers.  Resource requirements  vary
with customer demand, which may be subject to seasonal or general
economic  conditions.  The Company's ability to adapt to  changes
in  customer  transportation requirements is  a  key  element  in
efficiently deploying resources and in making capital investments
in tractors and trailers.  Although the Company's business volume
is  not highly concentrated, the Company may also be affected  by
the  financial failure of its customers or a loss of a customer's
business from time-to-time.

     Operating revenues consist of trucking revenues generated by
the six operating fleets in the Truckload Transportation Services
segment  (dedicated,  medium/long-haul van, regional  short-haul,
expedited,  flatbed, and temperature-controlled) and non-trucking
revenues  generated primarily by the Company's VAS segment.   The
Company's  Truckload Transportation Services segment  ("truckload
segment")  also includes a small amount of non-trucking  revenues
for the portion of shipments delivered to or from Mexico where it
utilizes  a  third-party carrier, and for a few of its  dedicated
accounts where the services of third-party carriers are  used  to
meet   customer  capacity  requirements.   Non-trucking  revenues
reported in the operating statistics table include those revenues
generated  by  the  VAS  segment, as  well  as  the  non-trucking
revenues  generated by the truckload segment.  Trucking  revenues
accounted for 88% of total operating revenues in 2005,  and  non-
trucking and other operating revenues accounted for 12%.

     Trucking services  typically generate revenue on a  per-mile
basis.  Other sources of trucking revenue include fuel surcharges
and  accessorial  revenue such as stop charges, loading/unloading
charges, and equipment detention charges.  Because fuel surcharge
revenues  fluctuate in response to changes in the cost  of  fuel,
these  revenues  are identified separately within  the  operating
statistics table and are excluded from the statistics to  provide
a  more  meaningful  comparison  between  periods.   Non-trucking
revenues  generated by a fleet whose operations are part  of  the
truckload  segment are included in non-trucking  revenue  in  the
operating statistics table so that the revenue statistics in  the
table  are  calculated using only the revenues generated  by  the
company-owned and owner-operator trucks.  The key statistics used
to  evaluate  trucking revenues, excluding fuel  surcharges,  are
average revenues per tractor per week, the per-mile rates charged
to  customers, the average monthly miles generated  per  tractor,
the  percentage of empty miles, the average trip length, and  the
average   number  of  tractors  in  service.   General   economic
conditions,  seasonal freight patterns in the trucking  industry,
and   industry  capacity  are  key  factors  that  impact   these
statistics.

     The  Company's  most significant  resource requirements  are
qualified  drivers,  tractors, trailers,  and  related  costs  of
operating  its  equipment (such as fuel and related  fuel  taxes,
driver  pay,  insurance,  and  supplies  and  maintenance).   The
Company  has historically been successful mitigating its risk  to
increases in fuel prices by recovering additional fuel surcharges
from  its customers that recoup a majority of the increased  fuel
costs;  however,  there  is no assurance  that  current  recovery
levels  will continue in future periods.  The Company's financial
results  are  also affected by availability of  drivers  and  the
market  for  new and used trucks.  Because the Company  is  self-
insured for a significant portion of cargo, personal injury,  and
property  damage claims on its revenue equipment and for workers'
compensation benefits for its employees (supplemented by premium-
based  coverage  above certain dollar levels), financial  results
may  also  be affected by driver safety, medical costs,  weather,
the  legal and regulatory environment, and the costs of insurance
coverage to protect against catastrophic losses.

     A common industry measure used to evaluate the profitability
of the Company and its trucking operating fleets is the operating
ratio  (operating expenses expressed as a percentage of operating
revenues).   The most significant variable expenses  that  impact
the trucking operation are driver salaries and benefits, payments
to owner-operators (included in rent and purchased transportation
expense),  fuel,  fuel  taxes (included  in  taxes  and  licenses

                                13


expense),  supplies  and maintenance, and insurance  and  claims.
Generally,  these  expenses vary based on  the  number  of  miles
generated.  As such, the Company also evaluates these costs on  a
per-mile  basis  to  adjust for the impact on the  percentage  of
total  operating  revenues caused by changes  in  fuel  surcharge
revenues,  per-mile rates charged to customers, and  non-trucking
revenues.   As  discussed further in the comparison of  operating
results for 2005 to 2004, several industry-wide issues, including
high  fuel  prices  and  a  challenging  driver  recruiting   and
retention  market,  could  cause  costs  to  increase  in  future
periods.   The  Company's main fixed costs  include  depreciation
expense  for  tractors and trailers and equipment licensing  fees
(included  in taxes and licenses expense).  Depreciation  expense
has  been  affected  by  the new engine emission  standards  that
became  effective in October 2002 for all newly purchased trucks,
which   have   increased  truck  purchase  costs.  The   trucking
operations require substantial cash expenditures for tractors and
trailers.  The  Company  has  accelerated  its  normal three-year
replacement cycle for company-owned tractors. These purchases are
funded by net cash from operations and financing available  under
the Company's existing credit facilities,  as  management   deems
necessary.

     Non-trucking  services provided  by the  Company,  primarily
through  its VAS division, include freight brokerage, intermodal,
multimodal,   freight   transportation  management,   and   other
services.   Unlike  the Company's trucking operations,  the  non-
trucking  operations  are less asset-intensive  and  are  instead
dependent upon information systems, qualified employees, and  the
services  of  other  third-party capacity  providers.   The  most
significant  expense item related to these non-trucking  services
is  the cost of transportation paid by the Company to third-party
capacity  providers,  which is recorded  as  rent  and  purchased
transportation  expense.  Other expenses include salaries,  wages
and  benefits  and  computer hardware and software  depreciation.
The  Company  evaluates the non-trucking operations by  reviewing
the  gross  margin percentage (revenues less rent  and  purchased
transportation expense expressed as a percentage of revenues) and
the  operating margin.  The operating margin for the non-trucking
business is lower than those of the trucking operations, but  the
return on assets is substantially higher.

Results of Operations

      The  following  table  sets  forth  certain  industry  data
regarding the freight revenues and operations of the Company  for
the periods indicated.




                                 2005        2004        2003        2002        2001
                              ----------  ----------  ----------  ----------  ----------
                                                               
Trucking revenues, net of
  fuel surcharge (1)          $1,493,826  $1,378,705  $1,286,674  $1,215,266  $1,150,361
Trucking fuel surcharge
  revenues (1)                   235,690     114,135      61,571      29,060      46,157
Non-trucking revenues,
  including VAS (1)              230,863     175,490     100,916      89,450      66,739
Other operating revenues (1)      11,468       9,713       8,605       7,680       7,262
                              ----------  ----------  ----------  ----------  ----------
  Operating revenues (1)      $1,971,847  $1,678,043  $1,457,766  $1,341,456  $1,270,519
                              ==========  ==========  ==========  ==========  ==========
Operating ratio
  (consolidated) (2)                91.7%       91.6%       91.9%       92.6%       93.8%
Average revenues per tractor
  per week (3)                $    3,286  $    3,136  $    2,988  $    2,932  $    2,874
Average annual miles per
  tractor                        120,912     121,644     121,716     123,480     123,660
Average annual trips per
  tractor                            187         185         173         166         166
Average total miles per trip         647         657         703         746         744
Average loaded miles per trip        568         583         627         674         670
Total miles (loaded and
  empty) (1)                   1,057,062   1,028,458   1,008,024     984,305     952,003
Average revenues per total
  mile (3)                    $    1.413  $    1.341  $    1.277  $    1.235  $    1.208
Average revenues per loaded
  mile (3)                    $    1.609  $    1.511  $    1.431  $    1.366  $    1.342
Average percentage of empty
  miles                             12.2%       11.3%       10.8%        9.6%       10.0%
Average tractors in service        8,742       8,455       8,282       7,971       7,698
Total tractors (at year end):
   Company                         7,920       7,675       7,430       7,180       6,640
   Owner-operator                    830         925         920       1,020       1,135
                              ----------  ----------  ----------  ----------  ----------
      Total tractors               8,750       8,600       8,350       8,200       7,775
                              ==========  ==========  ==========  ==========  ==========
Total trailers (at year end)      25,210      23,540      22,800      20,880      19,775
                              ==========  ==========  ==========  ==========  ==========


(1) Amounts in thousands
(2) Operating expenses expressed as  a  percentage  of  operating
revenues.  Operating  ratio is  a common  measure in the trucking
industry used to evaluate profitability.
(3) Net of fuel surcharge revenues

                                14


      The  following  table  sets forth the  revenues,  operating
expenses,  and  operating  income  for  the  truckload   segment.
Revenues  for the truckload segment include non-trucking revenues
of  $12.2  million,  $14.4 million, and $11.2 million  for  2005,
2004, and 2003, respectively, as described on page 13.



                                          2005                2004                2003
                                    -----------------   -----------------   -----------------
Truckload Transportation Services
  (amounts in 000's)                    $         %         $         %         $         %
---------------------------------   -----------------   -----------------   -----------------
                                                                      
Revenues                            $1,741,828  100.0   $1,506,937  100.0   $1,358,428  100.0
Operating expenses                   1,585,706   91.0    1,371,109   91.0    1,240,282   91.3
                                    ----------          ----------          ----------
Operating income                    $  156,122    9.0   $  135,828    9.0   $  118,146    8.7
                                    ==========          ==========          ==========



     Higher  fuel  prices and  higher fuel surcharge  collections
have   the   effect  of  increasing  the  Company's  consolidated
operating ratio and the truckload segment's operating ratio.  The
following  table  calculates  the truckload  segment's  operating
ratio  using  total  operating expenses, net  of  fuel  surcharge
revenues, as a percentage of revenues, excluding fuel surcharges.
Eliminating this sometimes volatile source of revenue provides  a
more  consistent  basis for comparing the results  of  operations
from period to period.



                                          2005                2004                2003
                                    -----------------   -----------------   -----------------
Truckload Transportation Services
  (amounts in 000's)                    $         %         $         %         $         %
---------------------------------   -----------------   -----------------   -----------------
                                                                      
Revenues                            $1,741,828          $1,506,937          $1,358,428
Less: trucking fuel surcharge
  revenues                             235,690             114,135              61,571
                                    ----------          ----------          ----------
Revenues, net of fuel surcharge      1,506,138  100.0    1,392,802  100.0    1,296,857  100.0
                                    ----------          ----------          ----------
Operating expenses                   1,585,706           1,371,109           1,240,282
Less: trucking fuel surcharge
  revenues                             235,690             114,135              61,571
                                    ----------          ----------          ----------
Operating expenses, net of
  fuel surcharge                     1,350,016   89.6    1,256,974   90.2    1,178,711   90.9
                                    ----------          ----------          ----------
Operating income                    $  156,122   10.4   $  135,828    9.8   $  118,146    9.1
                                    ==========          ==========          ==========



     The  following table sets  forth the non-trucking  revenues,
operating  expenses, and operating income for  the  VAS  segment.
Other operating expenses for the VAS segment primarily consist of
salaries,  wages  and benefits expense. VAS also  incurs  smaller
expense  amounts  in the supplies and maintenance,  depreciation,
rent   and   purchased   transportation  (excluding   third-party
transportation  costs), communications and utilities,  and  other
operating expense categories.




                                          2005                2004                2003
                                    -----------------   -----------------   -----------------
Value Added Services (amounts
  in 000's)                             $         %         $         %         $         %
---------------------------------   -----------------   -----------------   -----------------
                                                                      
Revenues                            $  218,620  100.0   $  161,111  100.0   $   89,742  100.0
Rent and purchased transportation
  expense                              196,972   90.1      145,474   90.3       83,387   92.9
                                    ----------          ----------          ----------
Gross margin                            21,648    9.9       15,637    9.7        6,355    7.1
Other operating expenses                13,203    6.0       10,006    6.2        5,901    6.6
                                    ----------          ----------          ----------
Operating income                    $    8,445    3.9   $    5,631    3.5   $      454    0.5
                                    ==========          ==========          ==========



2005 Compared to 2004
---------------------

Operating Revenues

     Operating revenues increased 17.5% in 2005 compared to 2004.
Excluding  fuel  surcharge revenues, trucking revenues  increased
8.3%  due  primarily to a 5.4% increase in average  revenues  per
total mile, excluding fuel surcharges, and a 3.4% increase in the
average  number of tractors in service, offset by a 0.6% decrease
in average annual miles  per tractor.  Average revenues per total
mile,  excluding fuel surcharges, increased due to customer  rate
increases,  and,  to  a  lesser extent, a 2.6%  decrease  in  the
average  loaded  trip length.  The truckload freight  environment
was  solid during 2005 due to ongoing truck capacity constraints.
In  comparison to 2004, demand in the months of March  to  August
2005 was not as strong as the strong freight market of 2004,  but

                                15


freight  demand  for  the  remaining  months  of  the  year   was
comparable to the demand in the same periods of 2004.

     The average percentage  of empty miles increased to 12.2% in
2005  from  11.3%  in  2004.   The increase  in  the  empty  mile
percentage  is  partially the result of a  higher  percentage  of
dedicated trucks in the fleet and a higher percentage of regional
shipments  with  a  shorter length of haul.  Over  the  past  few
years,  Werner  has grown its dedicated fleets,  arrangements  in
which  the  Company  provides  trucks  and/or  trailers  for  the
exclusive  use  of  a  specific customer.   For  almost  all  the
Company's  dedicated fleet arrangements, dedicated customers  pay
the  Company  on an all-miles basis (loaded or empty)  to  obtain
guaranteed truck and/or trailer capacity.  For freight management
and  statistical  reporting purposes, Werner  classifies  a  mile
without  cargo  in the trailer as an empty mile  (i.e.,  deadhead
mile).  Since dedicated fleets generally have a higher percentage
of  miles without cargo in the trailer and since the Company  has
been  growing its dedicated fleet business, this has  contributed
to  an  increase  in  the Company's reported average  empty  mile
percentage.   Excluding the dedicated fleet,  the  average  empty
mile percentage would be substantially lower for 2005 and 2004.

     During  third and fourth  quarter 2005, the Company's  sales
and marketing team renewed customer contracts and obtained annual
base  rate  increases for a substantial portion of the  Company's
non-dedicated fleet business that renewed in the second  half  of
2005.   Although the Company has taken steps to minimize or delay
certain controllable cost increases, base rate increases continue
to  be  necessary to recoup several inflationary  cost  increases
including driver pay and benefits, truck engine emissions  costs,
and  tolls  and to improve the Company's return on  assets.   The
Company  met its goals for these base rate increases in the  2005
renewal period.

     Fuel  surcharge revenues,  which represent collections  from
customers  for  the  higher  cost of fuel,  increased  to  $235.7
million in 2005 from $114.1 million in 2004 in response to higher
average fuel prices in 2005.  To lessen the effect of fluctuating
fuel  prices on the Company's margins, the Company collects  fuel
surcharge  revenues  from  its  customers.   The  Company's  fuel
surcharge programs are designed to recoup the higher cost of fuel
from  customers when fuel prices rise and provide customers  with
the  benefit  of  lower  costs when  fuel  prices  decline.   The
truckload  industry's fuel surcharge standard is a  one-cent  per
mile increase in rate for every five-cent per gallon increase  in
the  Department of Energy ("DOE") weekly retail on-highway diesel
prices  that  are  used for most fuel surcharge programs.   These
programs  have  historically enabled the  Company  to  recover  a
significant  portion of the fuel price increases.   However,  the
five-cent per gallon brackets only recoup about 80% to 85% of the
actual  increase  in  the cost of fuel, due to  empty  miles  not
billable  to customers, out-of-route miles, truck idle time,  and
the volatility in fuel prices  as prices  change rapidly in short
periods of time.

     VAS revenues increased  35.7% to $218.6 million in 2005 from
$161.1 million in 2004, and gross margin increased 38.4% for  the
same   period.   VAS  revenues  consist  primarily   of   freight
brokerage,   intermodal,   multimodal,   freight   transportation
management, and other services.  Most of the revenue growth  came
from the Company's brokerage and intermodal divisions within VAS.
The  Company continues to focus on growing the volume of business
in this segment, which provides customers with additional sources
of capacity.

Operating Expenses

     The  Company's operating ratio (operating expenses expressed
as  a  percentage of operating revenues) was 91.7% in 2005 versus
91.6% in 2004.  As explained on page 15, the significant increase
in  fuel  expense  and related fuel surcharge  revenues  had  the
effect  of increasing the operating ratio.  Because the Company's
VAS  business  operates  with  a lower  operating  margin  and  a
significantly higher return on assets than the trucking business,
the  growth  in  VAS  business  in 2005  compared  to  2004  also
increased  the Company's overall operating ratio.  The tables  on
page  15  show the operating ratios and operating margins for the
Company's  two  reportable   segments,  Truckload  Transportation
Services and Value Added Services.

                                16


     The  following table sets  forth the cost per total mile  of
operating expense items for the truckload segment for the periods
indicated.   The  Company  evaluates  operating  costs  for  this
segment  on  a  per-mile basis to adjust for the  impact  on  the
percentage of total operating revenues caused by changes in  fuel
surcharge revenues and rate per mile increases, which provides  a
more  consistent  basis for comparing the results  of  operations
from period to period.




                                                           Increase
                                                          (Decrease)
                                          2005      2004   per Mile  % Change
                                         ------------------------------------
                                                           
     Salaries, wages and benefits        $.532     $.519     $.013       2.5
     Fuel                                 .321      .211      .110      52.1
     Supplies and maintenance             .143      .130      .013      10.0
     Taxes and licenses                   .112      .106      .006       5.7
     Insurance and claims                 .083      .075      .008      10.7
     Depreciation                         .149      .138      .011       8.0
     Rent and purchased transportation    .149      .140      .009       6.4
     Communications and utilities         .019      .018      .001       5.6
     Other                               (.008)    (.003)    (.005)    166.7



     Owner-operator  costs are  included in  rent  and  purchased
transportation expense.  Owner-operator miles as a percentage  of
total miles were 12.5% in 2005 compared to 12.7% in 2004.  Owner-
operators  are  independent  contractors  who  supply  their  own
tractor  and  driver  and  are responsible  for  their  operating
expenses  including  fuel,  supplies and  maintenance,  and  fuel
taxes.   Because  the  change  in  owner-operator  miles   as   a
percentage of total miles was only minimal, there was essentially
no  shift  in  costs  from the rent and purchased  transportation
category  to  other  expense categories.   Over  the  past  year,
attracting and retaining owner-operator drivers continued  to  be
very difficult due to high fuel prices and other factors.

     Salaries,  wages and  benefits for non-drivers increased  in
2005  compared to 2004 to support the growth in the VAS  segment.
The  increase  in salaries, wages and benefits per  mile  of  1.3
cents  for  the  truckload  segment is primarily  the  result  of
increased student driver pay, higher driver pay per mile, and  an
increase in the number of maintenance employees.  Because of  the
challenging  driver  recruiting and retention  market,  discussed
below,  the  Company  is  training more  student  drivers  as  an
alternative source of drivers.  On August 1, 2004, the  Company's
previously announced two cent per mile pay raise became effective
for company solo drivers in its medium-to-long-haul van division,
representing  approximately 25% of total  company  drivers.   The
Company  recovered  this  pay raise  through  its  customer  rate
increase negotiations, which occurred in third and fourth quarter
2004.

     The driver recruiting and retention market remains extremely
challenging.   The  supply  of  truck  drivers  continues  to  be
constrained  due  to alternative jobs to truck driving  that  are
available  in  today's economy and inadequate demographic  growth
for  the  industry's targeted driver base over the  next  several
years.  The Company continues to focus on driver quality of  life
issues  such  as developing more driving jobs with more  frequent
home  time,  providing drivers with newer trucks, and  maximizing
mileage   productivity  within  the  federal  hours  of   service
regulations.   The  Company  has also  placed  more  emphasis  on
training  drivers.  Improved driver recruiting has offset  higher
driver  turnover; however, the Company expects the  tight  driver
market  will  make  it  very difficult to  add  meaningful  truck
capacity in the near future.

     The  Company  instituted an optional per diem  reimbursement
program  for  eligible company drivers beginning in  April  2004.
This program increases a company driver's net pay per mile, after
taxes.   As  a result of more drivers electing to participate  in
the  per  diem  program, driver pay per mile was  slightly  lower
before  considering the factors above that increased  driver  pay
per  mile, and the Company's effective income tax rate was higher
in  2005 compared to 2004.  The Company expects the cost  of  the
per  diem program to be neutral, because the combined driver  pay
rate  per  mile  and per diem reimbursement under  the  per  diem
program is about one cent per mile lower than mileage pay without
per  diem  reimbursement, which offsets the  Company's  increased
income taxes caused by the nondeductible portion of the per diem.
The per diem program increases driver satisfaction through higher
net  pay  per mile.  The Company anticipates that the competition

                                17


for  drivers will continue to be high and cannot predict  whether
it  will  experience shortages in the future.  If such a shortage
were  to occur and additional increases in driver pay rates  were
necessary to attract and retain drivers, the Company's results of
operations  would  be  negatively impacted  to  the  extent  that
corresponding freight rate increases were not obtained.

     On  January  1,  2006,  the  Company  adopted  Statement  of
Financial Accounting Standards ("SFAS") No. 123(R), and  it  will
now   report   in   its  financial  statements  the   share-based
compensation expense for reporting periods beginning in 2006.  As
of the date of this filing, management believes that adopting the
new  statement  will have a negative impact of approximately  two
cents   per  share  for  the  year  ending  December  31,   2006,
representing  the  expense  to  be recognized  for  the  unvested
portion  of  awards  granted  to date,  and  cannot  predict  the
earnings impact of awards that may be granted in the future.

     Fuel increased 11.0 cents per mile for the truckload segment
due  primarily to higher average diesel fuel prices. Average fuel
prices  in  2005 were 56 cents a gallon, or 47%, higher  than  in
2004.  Higher fuel costs, after considering the amounts collected
from  customers  through fuel surcharge  programs  and  the  cost
impact  of owner-operator fuel reimbursements (which is  included
in rent and purchased transportation expense) and lower fuel mile
per  gallon ("mpg") due to truck engine emissions changes, had  a
ten-cent  negative impact on earnings per share in 2005  compared
to  2004.   Company data continues to indicate an approximate  5%
fuel  mpg  degradation for trucks with post-October 2002  engines
(89%  of  the company-owned truck fleet as of December  31,  2005
compared  to  47%  as  of  December 31, 2004).   As  the  Company
replaces  the remaining 11% of the trucks in its fleet that  have
the  pre-October  2002 engines with trucks with the  post-October
2002  engines, fuel cost per mile is expected to increase further
due  to  the  lower  mpg.  Shortages of fuel, increases  in  fuel
prices,  or rationing of petroleum products can have a materially
adverse  effect  on  the  operations  and  profitability  of  the
Company.   The  Company is unable to predict whether  fuel  price
levels will continue to increase or decrease in the future or the
extent to which fuel surcharges will be collected from customers.
As  of December 31, 2005, the Company had no derivative financial
instruments to reduce its exposure to fuel price fluctuations.

     Diesel fuel prices for  the first six weeks of 2006 averaged
38 cents a gallon, or 26%,  higher than  average fuel  prices for
first quarter 2005.  If diesel fuel prices remain at the  average
price for the first six weeks of 2006, the Company estimates that
fuel will have a negative impact  on first quarter 2006  earnings
compared to first quarter  2005 earnings of  three cents to  four
cents per share.  The Company includes the following items in the
calculation  of  the  estimated  impact  of  higher fuel costs on
earnings: fuel  pricing,  fuel  reimbursement  to  owner-operator
drivers, lower  fuel mpg  due  to  the  increasing  percentage of
company-owned   trucks   with   post-October  2002  engines,  and
anticipated  fuel  surcharge  reimbursement.  It  is difficult to
estimate the impact of higher  fuel costs on earnings because  of
changing fuel pricing trends, the temporary lag effect of rapidly
changing  fuel  prices  on  fuel  surcharge  revenues,  and other
factors.  The actual  impact of fuel  costs on earnings  could be
higher or lower than estimated due to these factors.

     Supplies and maintenance for the truckload segment increased
1.3  cents on a per-mile basis in 2005 due primarily to increases
in  repair expenses for an increased number of trucks sold by the
Company's  Fleet  Truck  Sales subsidiary  and  higher  costs  to
maintain  the Company's trailer fleet.  Higher driver  recruiting
costs  (including driver advertising, transportation and lodging)
and higher toll expense related to state toll rate increases also
contributed to a smaller portion of the increase.

     Taxes and licenses for the  truckload segment increased  0.6
cents per total mile due primarily to the effect of the fuel  mpg
degradation  for  company-owned  trucks  with  post-October  2002
engines  on  the per-mile cost of federal and state  diesel  fuel
taxes, as well as increases in some state tax rates.

     Insurance and claims for the truckload segment increased 0.8
cents  on  a per-mile basis, primarily related to higher negative
development on existing liability insurance claims.  Cargo claims
expense  was  essentially flat on a per-mile  basis  compared  to
2004.  The  Company  renewed its liability insurance policies  on
August 1, 2005.  See  Item 3 "Legal  Proceedings" for information
on the Company's coverage levels for personal injury and property
damage since August 1, 2002.  Liability  insurance  premiums  for
the policy year beginning August 1, 2005 were  approximately  the

                                18


same as the previous  policy  year.  The  Company  is  unable  to
predict  whether the  trend of  increasing insurance  and  claims
expense will continue in the future.

     Depreciation expense for the truckload segment increased 1.1
cents  on a per-mile basis in 2005 due primarily to higher  costs
of  new  tractors  with the post-October  2002  engines.   As  of
December  31, 2005, approximately 89% of the company-owned  truck
fleet  consisted  of trucks with the post-October  2002  engines,
compared  to  47% at December 31, 2004.  As the Company  replaces
the  remaining 11% of the trucks in its fleet that have the  pre-
October  2002  engines  with trucks with  the  post-October  2002
engines, depreciation expense is expected to increase.

     Rent  and   purchased  transportation   consists  mainly  of
payments  to third-party capacity providers in the VAS and  other
non-trucking  operations and payments to owner-operators  in  the
trucking operations.  As shown in the VAS statistics table  under
the  "Results  of  Operations"  heading  on  page  15,  rent  and
purchased transportation expense for the VAS segment increased in
response  to higher VAS revenues.  These expenses generally  vary
depending on changes in the volume of services generated  by  the
segment.  As a percentage of VAS revenues, VAS rent and purchased
transportation  expense decreased to 90.1% in  2005  compared  to
90.3%  in  2004, resulting in a higher gross margin in 2005.   As
the  truck capacity market tightened during 2005, it became  more
difficult  to  find  qualified truckload  capacity  to  meet  VAS
customer  freight  needs, especially in the latter  part  of  the
year.   However,  the  Company's marketing efforts  continued  to
successfully  expand  its  VAS  qualified  carrier  base   in   a
constrained capacity market, ending the year with 3,600 qualified
broker  carriers.  The Company expects a tight truckload capacity
market  in 2006 with the extremely challenging driver market  and
historically high fuel prices.    During fourth quarter 2005, VAS
expanded  its small, but growing, intermodal presence by agreeing
to  manage   a  fleet  of   Union  Pacific-owned  containers  for
intermodal  freight  shipments.  The Company pays a daily fee per
container  to  Union  Pacific  ("UP")  for  any  days  that   the
containers are not in transit in the UP network.  As of  December
2005,  VAS  Intermodal   was  managing  400  UP  containers.  VAS
Intermodal  has  the  option  to,  and  expects  to, increase the
number  of  the  UP containers in 2006 as it further develops its
intermodal freight program.

     Rent and purchased  transportation for the truckload segment
increased  0.9 cents per total mile in 2005. Higher  fuel  prices
necessitated higher reimbursements to owner-operators  for  fuel,
which  resulted in an increase of 1.1 cents per total mile.   The
Company's  customer fuel surcharge programs do not  differentiate
between  miles  generated  by  Company-owned  trucks  and   miles
generated by owner-operator trucks; thus, the increase in  owner-
operator  fuel  reimbursements  is  included  with  Company  fuel
expenses in calculating the per-share impact of higher fuel costs
on  earnings.  The Company has experienced difficulty  recruiting
and  retaining  owner-operators for over three years  because  of
challenging  operating  conditions.  This  has  resulted   in   a
reduction in the number of owner-operator tractors to 830  as  of
December 31, 2005 from 925 as of December 31, 2004.  However, the
Company  has historically been able to add company-owned tractors
and recruit additional company drivers to offset any decreases in
owner-operators.   If a shortage of owner-operators  and  company
drivers were to occur and increases in per mile settlement  rates
became  necessary  to  attract  and retain  owner-operators,  the
Company's  results of operations would be negatively impacted  to
the  extent  that corresponding freight rate increases  were  not
obtained.   Payments to third-party capacity providers  used  for
portions  of shipments delivered to or from Mexico and by  a  few
dedicated fleets in the truckload segment decreased by 0.2  cents
per  mile,  partially  offsetting the overall  increase  for  the
truckload segment.

     Other operating expenses for the truckload segment decreased
0.5  cents  per mile in 2005. Gains on sales of assets, primarily
trucks,  are reflected as a reduction of other operating expenses
and  are reported net of sales-related expenses, including  costs
to  prepare  the  equipment for sale.  Gains on sales  of  assets
increased to $11.0 million in 2005 from $9.3 million in 2004, due
to  increased unit sales, partially offset by an increased  ratio
of  traded trucks to sold trucks. The Company's wholly-owned used
truck  retail network, Fleet Truck Sales, is one of  the  largest
class  8  truck  sales  entities in the United  States,  with  17
locations,  and  has been in operation since 1992.   Fleet  Truck
Sales continues to be a resource for the Company to remarket  its
used  trucks.   Other operating expenses also  include  bad  debt
expense and professional service fees.  The remaining decrease in
other  operating expenses in 2005 is due primarily to a reduction

                                19


in  computer  consulting fees as consultants were  hired  by  the
Company, resulting in a reduction in other operating expense, but
an increase in salaries, wages and benefits expense.

     The  Company  recorded $0.7 million of interest  expense  in
2005  versus virtually no interest expense in 2004.  The  Company
incurred debt of $60.0 million during the fourth quarter of  2005
and  had no debt outstanding throughout 2004.  The Company repaid
$35.0 million of its debt in January 2006 and expects to pay down
the remaining debt during the first half of 2006, due to expected
lower  net capital expenditures.  Interest income for the Company
increased to $3.4 million in 2005 from $2.6 million in  2004  due
to  improved interest rates, partially offset by a declining cash
balance throughout 2005.

     The  Company's  effective  income  tax  rate  (income  taxes
expressed  as  a  percentage  of  income  before  income   taxes)
increased  to  41.0% in 2005 from 39.2% in 2004, as described  in
Note  4  of the Notes to Consolidated Financial Statements  under
Item  8 of this Form 10-K.  The income tax rate increased in 2005
because  of  higher  non-deductible  expenses  for  tax  purposes
related  to  the  implementation of a per diem  pay  program  for
student drivers in fourth quarter 2003 and a per diem pay program
for eligible company drivers in April 2004.  The Company does not
expect its effective income tax rate to increase in 2006.

2004 Compared to 2003
---------------------

Operating Revenues

     Operating revenues increased 15.1% in 2004 compared to 2003.
Excluding  fuel  surcharge revenues, trucking revenues  increased
7.2%  due  primarily to a 5.0% increase in average  revenues  per
total mile, excluding fuel surcharges, and a 2.1% increase in the
average  number  of  tractors in service.  Average  revenues  per
total  mile, excluding fuel surcharges, increased due to customer
rate  increases, an improvement in freight selection, and a  7.0%
decrease in the average loaded trip length due to growth  in  the
Company's  dedicated fleet.  Part of the growth in the  dedicated
fleet  was  offset by a decrease in the Company's medium-to-long-
haul  van  fleet.  Dedicated fleet business tends to  have  lower
miles per trip, a higher empty mile percentage, a higher rate per
loaded  mile, and lower miles per truck.  The growth in dedicated
business  had  a  corresponding effect on  these  same  operating
statistics,  as  reported above, for the entire Company.   During
2004,  the  truckload  freight environment  strengthened  due  to
ongoing  truck  capacity  constraints and  a  steadily  improving
economy.

     Beginning in  August 2004, the Company's sales and marketing
team  met  with customers to negotiate annual rate  increases  to
recoup  the  significant  cost increases  in  fuel,  driver  pay,
equipment,  and insurance and to improve margins.   Much  of  the
Company's  non-dedicated  contractual  business  renewed  in  the
latter  part of third quarter and fourth quarter. As a result  of
these  efforts,  average revenues per total  mile,  net  of  fuel
surcharges,  rose seven cents a mile, or 5.3%, sequentially  from
second quarter 2004 to fourth quarter 2004.

     Fuel surcharge revenues  increased to $114.1 million in 2004
from  $61.6 million in 2003 due to higher average fuel prices  in
2004.   These  surcharge  programs,  which  automatically  adjust
depending  on  the  DOE weekly retail on-highway  diesel  prices,
continued in effect throughout 2004.  Typical programs specify  a
base  price  per gallon when surcharges can begin to  be  billed.
Above  this  price, the Company bills a surcharge rate  per  mile
when  the  price per gallon falls in a bracketed  range  of  fuel
prices.   When  fuel  prices increase, fuel surcharges  recoup  a
lower  percentage of the incrementally higher costs  due  to  the
impact  of  inadequate recovery for empty miles not  billable  to
customers,  out-of-route  miles, truck idle  time,  and  "bracket
creep".   "Bracket  creep" occurs when fuel prices  approach  the
upper  limit of the bracketed range, but a higher surcharge  rate
per mile cannot be billed until the fuel price per gallon reaches
the  next bracket.  Also, the DOE survey price used for surcharge
contracts  changes  once  a week while fuel  prices  change  more
frequently.   Because  collections of fuel  surcharges  typically
trail  fuel  price  changes, rapid fuel price increases  cause  a
temporarily  unfavorable effect of fuel  prices  increasing  more
rapidly  than  fuel  surcharge revenues.  This  effect  typically
reverses when fuel prices fall.

                                20


     VAS revenues increased to  $161.1 million in 2004 from $89.7
million in 2003, or 79.5%, and gross margin increased 146.1%  for
the  same  period.   Most of this revenue growth  came  from  the
Company's brokerage group within VAS.  During 2004, the expansion
of  the  Company's VAS services assisted customers  by  providing
needed capacity while driving cost out of their freight network.

Operating Expenses

     The Company's operating ratio was 91.6% in 2004 versus 91.9%
in  2003.   Because the Company's VAS business  operates  with  a
lower  operating  margin and a higher return on assets  than  the
trucking business, the substantial growth in VAS business in 2004
compared to 2003 affected the Company's overall operating  ratio.
As explained on page 15, the significant increase in fuel expense
and  related fuel surcharge revenues also affected the  operating
ratio.  The tables on  page 15  show  the  operating  ratios  and
operating margins for  the  Company's  two  reportable  segments,
Truckload Transportation Services and Value Added Services.

     The  following table  sets forth the cost per total mile  of
operating expense items for the truckload segment for the periods
indicated.   The  Company  evaluates  operating  costs  for  this
segment  on  a  per-mile basis to adjust for the  impact  on  the
percentage of total operating revenues caused by changes in  fuel
surcharge revenues and rate per mile increases, which provides  a
more  consistent  basis for comparing the results  of  operations
from period to period.



                                                           Increase
                                                          (Decrease)
                                          2004      2003   per Mile  % Change
                                         ------------------------------------
                                                           
     Salaries, wages and benefits        $.519     $.502     $.017       3.4
     Fuel                                 .211      .158      .053      33.5
     Supplies and maintenance             .130      .117      .013      11.1
     Taxes and licenses                   .106      .103      .003       2.9
     Insurance and claims                 .075      .072      .003       4.2
     Depreciation                         .138      .132      .006       4.5
     Rent and purchased transportation    .140      .131      .009       6.9
     Communications and utilities         .018      .016      .002      12.5
     Other                               (.003)    (.001)    (.002)    200.0



     Owner-operator  miles  as a percentage of total  miles  were
12.7%  in 2004 compared to 12.6% in 2003.  Because the change  in
owner-operator  miles  as a percentage of total  miles  was  only
minimal, there was essentially no shift in costs to the rent  and
purchased  transportation category from other expense categories.
During 2004, attracting and retaining owner-operator drivers  was
difficult due to the challenging operating conditions.

     Salaries,  wages and benefits  for non-drivers increased  in
2004  compared to 2003 to support the growth in the VAS  segment.
The  increase  in salaries, wages and benefits per  mile  of  1.7
cents for the truckload segment is primarily the result of higher
driver pay per mile.  On August 1, 2004, the Company's previously
announced  two  cent  per  mile pay raise  became  effective  for
company  solo  drivers in its medium-to-long-haul  van  division,
representing  approximately 25% of total  drivers.   The  Company
recovered  a  substantial portion of this pay raise  through  its
customer  rate  increase negotiations.  As a result  of  the  new
hours  of service regulations effective at the beginning of 2004,
the  Company increased driver pay in the non-dedicated fleets for
multiple stop shipments.  Additional revenue from increased rates
per  stop  offset most of the increased driver pay.  The increase
in  dedicated business as a percentage of total trucking business
also  contributed  to  the increase in driver  pay  per  mile  as
dedicated  drivers are usually compensated at a higher  rate  per
mile  due  to  the lower average miles per truck.  The  Company's
dedicated   fleets   also  typically  have  higher   amounts   of
loading/unloading pay and minimum pay.

     During  the last quarter  of 2003, the market for recruiting
experienced  drivers tightened.  The Company experienced  initial
improvement in driver turnover after announcing the two-cent  per
mile  pay  raise  that became effective in August 2004;  however,
that improvement has been difficult to sustain.  Alternative jobs
with  an  improving  economy, weak population  demographics,  and
competitor  pay  raises are expected to keep  the  driver  market
challenging.  In  2004, the Company expanded  its  student-driver

                                21


training program to attract more drivers to the Company  and  the
industry.   The Company also offered an increasing percentage  of
driving  jobs  with  more frequent home time  in  its  dedicated,
regional,   and   network-optimization   fleets.    The   Company
instituted  an  optional  per  diem  reimbursement  program   for
eligible company drivers (approximately half of total non-student
company drivers) beginning in April 2004.  This program increases
a  company driver's net pay per mile, after taxes.  As a  result,
driver  pay  per  mile was slightly lower before considering  the
factors  above  that  increased driver  pay  per  mile,  and  the
Company's  effective income tax rate was higher in 2004  compared
to 2003.

     Fuel increased 5.3 cents  per mile for the truckload segment
due primarily to higher average diesel fuel prices.  Average fuel
prices  in  2004 were 30 cents a gallon, or 32%, higher  than  in
2003.  Fuel expense, after considering the amounts collected from
customers  through fuel surcharge programs, net of  reimbursement
to  owner-operators, had an eight-cent negative  impact  on  2004
earnings  per  share  compared to 2003 earnings  per  share.   In
addition  to the increase in fuel prices, company data  indicated
that  the fuel mpg degradation for trucks with post-October  2002
engines (47% of the company-owned truck fleet as of December  31,
2004)  was  a reduction of approximately 5%.  As of December  31,
2004,  the  Company  had no derivative financial  instruments  to
reduce its exposure to fuel price fluctuations.

     Supplies and maintenance for the truckload segment increased
1.3  cents on a per-mile basis in 2004 due primarily to increases
in   the  cost  of  over-the-road  repairs  and  an  increase  in
maintenance  on  equipment sales related to a  larger  number  of
tractors  sold through the Company's Fleet Truck Sales subsidiary
in  2004 versus 2003.  Over-the-road ("OTR") repairs increased as
a  result  of  the  increase  in  dedicated-fleet  trucks,  which
typically  do not have as much maintenance performed  at  company
terminals.   The  Company  includes  the  higher  cost   of   OTR
maintenance  in  its  dedicated pricing  models.   Higher  driver
recruiting costs (including driver advertising) and driver travel
and lodging also contributed to a small portion of the increase.

     Insurance and claims for the truckload segment increased 0.3
cents on a per-mile basis, primarily related to liability claims.
Cargo  claims  expense was essentially flat on a  per-mile  basis
compared to 2003.

     The  Company  renewed  its  liability  insurance policies on
August 1, 2004.  Effective  August 1, 2004,  the  Company  became
responsible  for  the  first  $2.0  million per claim (previously
$500,000  per  claim).   See   Item   3  "Legal Proceedings"  for
information on the Company's coverage levels for personal  injury
and property damage since August 1, 2002.  The increased  Company
retention from $500,000 to $2.0 million was due to changes in the
trucking insurance  market  and  was  similar  to increased claim
retention  levels  experienced   by  other   truckload  carriers.
Liability insurance premiums for the policy year beginning August
1, 2004 decreased approximately $0.4  million due to  the  higher
retention level.

     Depreciation expense for the truckload segment increased 0.6
cents  on a per-mile basis in 2004 due primarily to higher  costs
of new tractors with the post-October 2002 engines.

     Rent  and   purchased  transportation   consists  mainly  of
payments  to third-party capacity providers in the VAS and  other
non-trucking  operations and payments to owner-operators  in  the
trucking operations.  Rent and purchased transportation  for  the
truckload  segment increased 0.9 cents per total mile  as  higher
fuel prices necessitated higher reimbursements to owner-operators
for  fuel.  The Company has experienced difficulty recruiting and
retaining   owner-operators  for  over  two  years   because   of
challenging   operating  conditions.  Payments   to   third-party
capacity providers used for portions of shipments delivered to or
from  Mexico  and  by  a few dedicated fleets  in  the  truckload
segment contributed 0.2 cents of the total per-mile increase  for
the truckload segment.

     As shown in the VAS  statistics table under the "Results  of
Operations" heading on page 15, rent and purchased transportation
expense  for the VAS segment increased in response to higher  VAS
revenues.   As  a  percentage  of  VAS  revenues,  VAS  rent  and
purchased  transportation  expense decreased  to  90.3%  in  2004
compared to 92.9% in 2003, resulting in a higher gross margin  in
2004.   An  improving  truckload  freight  environment  in   2004
resulted   in  improved  customer  rates  for  the  VAS  segment.
Additionally, to support the ongoing growth within VAS, the group
has increased its number of approved third-party providers.  This

                                22


larger  carrier  base  allows  VAS to  more  competitively  match
customer  freight with available capacity, resulting in  improved
margins.

     Other operating expenses for the truckload segment decreased
0.2 cents per mile in 2004.  Gains on sales of assets,  primarily
trucks,  were  $9.3 million  in 2004  compared to $7.6 million in
2003.  In 2004, the Company sold about three-fourths of its  used
trucks  to third  parties and  traded about one-fourth.  In 2003,
the Company sold about two-thirds of its used trucks  and  traded
about  one-third.   Gains  increased due  to a  larger number  of
trucks sold in  2004, with a  lower average  gain per  truck.  In
July  2004,  the  Company also began recording gains  on  certain
tractor trades in accordance with EITF 86-29.  In 2002, 2003, and
the  first six months of 2004, the excess of the trade price over
the net book value of the trucks exchanged reduced the cost basis
of  new trucks. This change did not have a material impact on the
Company's  results of operations.  Other operating expenses  also
include  bad  debt  expense and professional service  fees.   The
Company incurred approximately $0.7 million in professional  fees
in  2004 in connection with the implementation of Section 404  of
the Sarbanes-Oxley Act of 2002.

     The  Company  recorded essentially no  interest  expense  in
2004,  as  it  repaid its last remaining debt in  December  2003.
Interest income for the Company increased to $2.6 million in 2004
from $1.7 million in 2003 due to higher average cash balances  in
2004 compared to 2003.

     The Company's effective income tax rate increased from 37.5%
in  2003 to 39.2% in 2004, as described in Note 4 of the Notes to
Consolidated Financial Statements under Item 8 of this Form 10-K.
The  income  tax  rate increased in 2004 because of  higher  non-
deductible   expenses   for   tax   purposes   related   to   the
implementation of a per diem pay program for student  drivers  in
fourth  quarter  2003  and a per diem pay  program  for  eligible
company drivers in April 2004.

Liquidity and Capital Resources

     During  the  year  ended  December  31,  2005,  the  Company
generated  cash flow from operations of $172.5 million,  a  23.9%
decrease ($54.1 million) in cash flow compared to the year  ended
December 31, 2004.  The decrease in cash flow from operations  is
due  primarily to larger federal income tax payments in 2005  and
an  increase  in  days  sales in accounts receivable,  offset  by
higher  depreciation  expense  for financial  reporting  purposes
related  to the higher cost of the post-October 2002 engines  and
higher  net income.  Income taxes paid during 2005 totaled  $99.2
million  compared  to $42.9 million in 2004.  This  increase  was
related  to  recent tax law changes resulting in the reversal  of
certain  tax strategies implemented in 2001 and lower income  tax
depreciation in 2005 due to the bonus tax depreciation  provision
that  expired  on  December 31, 2004.  The Company  made  federal
income  tax payments of $22.5 million related to the reversal  of
the  tax  strategies  in second quarter  2005.   Cash  flow  from
operations increased $19.1 million in 2004 compared to  2003,  or
9.2%,  as  the  Company returned to a normal tractor  replacement
cycle  in  2004 after purchasing fewer trucks in 2003.  The  cash
flow from operations and existing cash balances, supplemented  by
borrowings  under  its  existing credit facilities,  enabled  the
Company  to  make net capital expenditures and pay  dividends  as
discussed below.

     Net  cash  used  in  investing  activities  increased  52.1%
($100.8 million) to $294.3 million in 2005 from $193.5 million in
2004.   The  large  increase  was due primarily  to  the  Company
purchasing more new tractors in 2005 to reduce the average age of
its truck fleet, as compared to a more normal tractor replacement
cycle  in 2004.  The 90.5% increase ($91.9 million) from 2003  to
2004  was  due  primarily  to the Company  purchasing  fewer  new
tractors  in 2003 following its accelerated purchases of tractors
with  pre-October  2002 engines in the latter  part  of  2002  in
advance of the first phase of new EPA engine emissions standards.
As  of  December 31, 2005, approximately 89% of the company-owned
truck  fleet  consisted of trucks with the new engines,  and  the
average  age  of the Company's truck fleet was 1.23  years.   The
Company's  goal  is to keep its fleet as new as  possible  during
2006.  Net capital expenditures in 2006 are expected to return to
more  normal  levels,  with  lower  than  normal  expected  truck
purchases in the first half of 2006.

                                23


     As  of  December  31, 2005, the  Company  has  committed  to
property and equipment purchases, net of trades, of approximately
$33.1  million.   The Company intends to fund these  net  capital
expenditure commitments through cash flow from operations.

     Net financing activities  provided $48.9 million in 2005 and
used   $25.7  million  and  $33.8  million  in  2004  and   2003,
respectively.   The  change  from  2004  to  2005  resulted  from
borrowings of $60.0 million in the fourth quarter of 2005 to fund
a portion of the Company's net capital expenditures, as described
above.   Through the date of this report, the Company has  repaid
$35.0  million of the total $60.0 million of debt outstanding  on
December  31,  2005  and  expects to repay  the  remaining  $25.0
million  during  the  first  half  of  2006.   The  Company  paid
dividends  of  $11.9 million in 2005, $9.5 million in  2004,  and
$6.5  million  in  2003.   The Company  increased  its  quarterly
dividend rate by $.005 per share beginning with the dividend paid
in  July 2005, and by $0.01 per share beginning with the dividend
paid  in  July  2004.  Financing activities also included  common
stock repurchases of $1.6 million in 2005, $21.6 million in 2004,
and  $13.5  million in 2003.  From time to time, the Company  has
repurchased, and may continue to repurchase, shares of its common
stock.  The timing and amount of such purchases depends on market
and   other  factors.   The  Company's  Board  of  Directors  has
authorized  the  repurchase of up to  3,965,838  shares.   As  of
December  31,  2005,  the  Company had purchased  257,038  shares
pursuant to this authorization and had 3,708,800 shares remaining
available for repurchase.

     Management  believes  the  Company's financial  position  at
December  31,  2005  is  strong.  As of December  31,  2005,  the
Company had $36.6 million of cash and cash equivalents and $862.5
million  of  stockholders' equity. As of December 31,  2005,  the
Company   had  $125.0  million  of  credit  pursuant  to   credit
facilities,  of  which  it  had  borrowed  $60.0  million.    The
remaining   $65.0  million  of  credit  available   under   these
facilities is further reduced by the $37.2 million in letters  of
credit  the  Company  maintains.  These  letters  of  credit  are
primarily  required as security for insurance  policies.   As  of
December  31,  2005,  the  Company had no non-cancelable  revenue
equipment  operating leases, and therefore,  had  no  off-balance
sheet  revenue  equipment debt.  Based on  the  Company's  strong
financial  position, management foresees no significant  barriers
to obtaining sufficient financing, if necessary.

Contractual Obligations and Commercial Commitments

     The  following  tables  set forth the Company's  contractual
obligations and commercial commitments as of December 31, 2005.




                                Payments Due by Period
                                    (in millions)
                                           Less than     1-3     4-5     Over 5
      Contractual Obligations    Total       1 year     years   years    years
----------------------------------------------------------------------------------
                                                          
Long-term debt, including
  current maturities            $  60.0     $  60.0     $   -   $   -    $   -
                                -------     -------     -----   -----    -----
Total contractual cash
  obligations                   $  60.0     $  60.0     $   -   $   -    $   -
                                =======     =======     =====   =====    =====


                    Amount of Commitment Expiration Per Period
                                    (in millions)


                                 Total
      Other Commercial          Amounts    Less than     1-3     4-5     Over 5
        Commitments            Committed     1 year     years   years    years
----------------------------------------------------------------------------------
Unused lines of credit          $  27.8     $  25.0     $ 2.8   $   -    $   -
Standby letters of credit          37.2        37.2         -       -        -
Other commercial commitments       33.1        33.1         -       -        -
                                -------     -------     -----   -----    -----
Total commercial commitments    $  98.1     $  95.3     $ 2.8   $   -    $   -
                                =======     =======     =====   =====    =====



     The  Company has  committed credit facilities with two banks
totaling  $125.0 million, of which it had borrowed $60.0 million.
These  credit facilities bear variable interest (4.8% at December
31, 2005)  based on  the London Interbank Offered Rate ("LIBOR").
The credit available under these facilities is further reduced by
the  amount  of  standby letters of credit the Company maintains.

                                24


The  unused lines  of credit  are available to the Company in the
event  the  Company needs  financing for the growth of its fleet.
With the Company's strong financial position, the Company expects
it could obtain additional financing, if necessary, at  favorable
terms.  The standby letters of credit are primarily required  for
insurance  policies.  The other commercial commitments relate  to
committed equipment expenditures.

Off-Balance Sheet Arrangements

     The  Company  does  not  have  arrangements  that  meet  the
definition of an off-balance sheet arrangement.

Critical Accounting Policies

     The  Company's success depends on its ability to efficiently
manage  its resources in the delivery of truckload transportation
and  logistics services to its customers.  Resource  requirements
vary  with  customer demand, which may be subject to seasonal  or
general  economic conditions.  The Company's ability to adapt  to
changes  in customer transportation requirements is a key element
in   efficiently  deploying  resources  and  in  making   capital
investments  in  tractors and trailers.  Although  the  Company's
business volume is not highly concentrated, the Company may  also
be  affected by the financial failure of its customers or a  loss
of a customer's business from time-to-time.

     The  Company's  most  significant resource requirements  are
qualified  drivers,  tractors, trailers,  and  related  costs  of
operating  its  equipment (such as fuel and related  fuel  taxes,
driver pay, insurance, and supplies and maintenance). The Company
has historically been successful mitigating its risk to increases
in  fuel prices by recovering additional fuel surcharges from its
customers.  The Company's financial results are also affected  by
availability  of drivers and the market for new and used  trucks.
Because the Company is self-insured for a significant portion  of
its  cargo,  personal injury, and property damage claims  on  its
trucks  and for workers' compensation benefits for its  employees
(supplemented  by  premium-based coverage  above  certain  dollar
levels), financial results may also be affected by driver safety,
medical costs, weather, the legal and regulatory environment, and
the  costs  of insurance coverage to protect against catastrophic
losses.

     The  most significant accounting policies and estimates that
affect our financial statements include the following:

     * Selections  of  estimated useful  lives and salvage values
       for  purposes  of   depreciating  tractors  and  trailers.
       Depreciable lives of tractors and trailers range from 5 to
       12 years.  Estimates of salvage value at the expected date
       of  trade-in  or  sale  (for   example,  three  years  for
       tractors)  are  based  on  the  expected  market values of
       equipment at the time of disposal.  Although the Company's
       normal  replacement cycle for tractors is three years, the
       Company  calculates  depreciation  expense  for  financial
       reporting  purposes using a five-year life and 25% salvage
       value.  Depreciation  expense  calculated  in  this manner
       continues   at   the   same   straight-line   rate,  which
       approximates  the continuing declining market value of the
       tractors,  in  those instances  in which a tractor is held
       beyond the normal three-year age. Calculating depreciation
       expense  using  a  five-year  life  and  25% salvage value
       results  in the same annual depreciation rate (15% of cost
       per year) and the same net book value at the normal three-
       year  replacement date (55% of cost) as using a three-year
       life  and  55%  salvage  value.  The  Company  continually
       monitors the adequacy of the lives and salvage values used
       in  calculating  depreciation  expense  and  adjusts these
       assumptions appropriately when warranted.
     * Impairment of long-lived assets.  The Company reviews  its
       long-lived  assets  for  impairment   whenever  events  or
       changes in circumstances indicate that the carrying amount
       of  a  long-lived  asset  may  not   be  recoverable.   An
       impairment loss would be recognized if the carrying amount
       of the long-lived asset is not recoverable, and it exceeds
       its fair value.  For long-lived assets classified as  held
       and  used, if  the carrying  value of the long-lived asset
       exceeds  the  sum of  the future net cash flows, it is not
       recoverable.  The  Company  does not  separately  identify

                                25


       assets by operating segment, as tractors and trailers  are
       routinely transferred from one operating fleet to another.
       As a result, none of the Company's long-lived assets  have
       identifiable  cash   flows  from  use   that  are  largely
       independent  of  the  cash  flows  of   other  assets  and
       liabilities.  Thus,  the   asset  group   used  to  assess
       impairment  would  include  all  assets  of   the Company.
       Long-lived assets classified as held for sale are reported
       at the  lower of  their carrying amount or fair value less
       costs to sell.
     * Estimates  of accrued liabilities for insurance and claims
       for  liability  and  physical damage losses  and  workers'
       compensation.  The insurance and claims accruals  (current
       and  long-term)  are  recorded  at  the estimated ultimate
       payment  amounts  and  are  based   upon  individual  case
       estimates,  including negative  development, and estimates
       of  incurred-but-not-reported   losses  based   upon  past
       experience.  The  Company's  self-insurance  reserves  are
       reviewed by an actuary every six months.
     * Policies  for  revenue  recognition.   Operating  revenues
       (including fuel surcharge  revenues)  and  related  direct
       costs  are  recorded  when the shipment is delivered.  For
       shipments  where  a   third-party  capacity   provider  is
       utilized  to  provide  some  or all of the service and the
       Company is the primary obligor in regards to the  delivery
       of  the  shipment, establishes customer pricing separately
       from  carrier  rate negotiations, generally has discretion
       in  carrier  selection,  and/or  has  credit  risk  on the
       shipment, the Company records both revenues for the dollar
       value  of  services billed  by the Company to the customer
       and rent and  purchased  transportation  expense  for  the
       costs  of  transportation  paid  by  the  Company  to  the
       third-party provider upon delivery of the shipment. In the
       absence  of  the  conditions  listed  above,  the  Company
       records  revenues  net  of expenses related to third-party
       providers.
     * Accounting  for  income  taxes.   Significant   management
       judgment is required to determine the provision for income
       taxes and to determine whether deferred income taxes  will
       be realized in full or in part. Deferred income tax assets
       and  liabilities  are  measured  using  enacted  tax rates
       expected to apply to taxable income in the years in  which
       those  temporary  differences are expected to be recovered
       or  settled.  When  it  is  more  likely  that all or some
       portion of specific deferred income tax assets will not be
       realized, a valuation  allowance must  be established  for
       the   amount  of  deferred  income  tax  assets  that  are
       determined not to be realizable. A valuation allowance for
       deferred  income  tax  assets  has  not  been deemed to be
       necessary  due  to  the  Company's  profitable operations.
       Accordingly, if the  facts or financial circumstances were
       to  change, thereby  impacting the likelihood of realizing
       the deferred income tax assets, judgment would need to  be
       applied  to  determine  the amount  of valuation allowance
       required in any given period.

     Management  periodically  re-evaluates  these  estimates  as
events  and  circumstances change.  Together with the effects  of
the  matters  discussed  above, these factors  may  significantly
impact the Company's results of operations from period-to-period.

Inflation

     Inflation can be expected to have an impact on the Company's
operating  costs.   A prolonged period of inflation  could  cause
interest  rates,  fuel, wages, and other costs  to  increase  and
could adversely affect the Company's results of operations unless
freight  rates could be increased correspondingly.  However,  the
effect of inflation has been minimal over the past three years.

ITEM  7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT  MARKET
           RISK

     The  Company  is  exposed to  market risk  from  changes  in
interest  and  foreign  currency  exchange  rates  and  commodity
prices.

                                26


Interest Rate Risk

     The  Company  had  $60.0  million  of   variable  rate  debt
outstanding  at  December 31, 2005.  The interest  rates  on  the
variable rate debt are based on the London Interbank Offered Rate
("LIBOR"). Assuming this level of borrowings, a hypothetical one-
percentage  point  increase  in the  LIBOR  interest  rate  would
increase the Company's annual interest expense by $600,000.   The
Company  has  no derivative financial instruments to  reduce  its
exposure to interest rate increases.

Commodity Price Risk

     The  price  and availability  of diesel fuel are subject  to
fluctuations  due  to  changes  in  the  level  of   global   oil
production,  refining capacity, seasonality, weather,  and  other
market  factors.   Historically, the Company  has  been  able  to
recover a majority of fuel price increases from customers in  the
form  of fuel surcharges.  The Company cannot predict the  extent
to  which  high fuel price levels will continue in the future  or
the  extent to which fuel surcharges could be collected to offset
such  increases.   As of December 31, 2005, the  Company  had  no
derivative financial instruments to reduce its exposure  to  fuel
price fluctuations.

Foreign Currency Exchange Rate Risk

     The Company conducts business in Mexico and Canada.  Foreign
currency  transaction gains and losses were not material  to  the
Company's  results  of  operations  for  2005  and  prior  years.
Accordingly,  the  Company is not currently subject  to  material
foreign  currency  exchange  rate risks  from  the  effects  that
exchange rate movements of foreign currencies would have  on  the
Company's  future  costs  or  on  future  cash  flows.  To  date,
virtually  all foreign revenues are denominated in U.S.  dollars,
and  the  Company receives payment for freight services performed
in  Mexico and Canada primarily in U.S. dollars to reduce  direct
foreign currency risk.

                                27


ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors
Werner Enterprises, Inc.:

     We have audited the accompanying consolidated balance sheets
of  Werner Enterprises, Inc. and subsidiaries as of December  31,
2005 and 2004, and the related consolidated statements of income,
stockholders' equity and comprehensive income, and cash flows for
each  of  the  years in the three-year period ended December  31,
2005.    In  connection  with  our  audits  of  the  consolidated
financial   statements,  we  have  also  audited  the   financial
statement schedule for each of the years in the three-year period
ended December 31, 2005, listed in Item 15(a)(2) of this Form 10-
K.   These   consolidated  financial  statements  and   financial
statement  schedule  are  the  responsibility  of  the  Company's
management. Our responsibility is to express an opinion on  these
consolidated   financial  statements  and   financial   statement
schedule based on our audits.

     We conducted  our audits in accordance with the standards of
the  Public  Company Accounting Oversight Board (United  States).
Those  standards require that we plan and perform  the  audit  to
obtain   reasonable   assurance  about  whether   the   financial
statements  are free of material misstatement. An audit  includes
examining,  on a test basis, evidence supporting the amounts  and
disclosures  in the financial statements. An audit also  includes
assessing   the   accounting  principles  used  and   significant
estimates  made by management, as well as evaluating the  overall
financial  statement  presentation. We believe  that  our  audits
provide a reasonable basis for our opinion.

     In  our  opinion,  the  consolidated   financial  statements
referred  to above present fairly, in all material respects,  the
financial  position of Werner Enterprises, Inc. and  subsidiaries
as  of  December  31,  2005 and 2004, and the  results  of  their
operations  and  their cash flows for each of the  years  in  the
three-year  period  ended December 31, 2005, in  conformity  with
U.S.  generally accepted accounting principles.  In addition,  in
our  opinion, the financial statement schedule referred to above,
when  considered in relation to the basic consolidated  financial
statements  taken as a whole, presents fairly,  in  all  material
respects, the information set forth therein.

     We  also have audited, in  accordance with the standards  of
the  Public  Company Accounting Oversight Board (United  States),
the  effectiveness of Werner Enterprises, Inc.'s internal control
over  financial  reporting  as of December  31,  2005,  based  on
criteria  established in Internal Control - Integrated  Framework
issued  by  the  Committee  of Sponsoring  Organizations  of  the
Treadway Commission (COSO), and our report dated February 1, 2006
expressed  an unqualified opinion on management's assessment  of,
and  the  effective operation of, internal control over financial
reporting.

                              KPMG LLP
Omaha, Nebraska
February 1, 2006

                                28


                    WERNER ENTERPRISES, INC.
                CONSOLIDATED STATEMENTS OF INCOME
            (In thousands, except per share amounts)




                                          Years Ended December 31,
                                      --------------------------------
                                         2005       2004       2003
                                      ---------- ---------- ----------
                                                   
Operating revenues                    $1,971,847 $1,678,043 $1,457,766
                                      ---------- ---------- ----------

Operating expenses:
  Salaries, wages and benefits           574,893    544,424    513,551
  Fuel                                   340,622    218,095    160,465
  Supplies and maintenance               154,719    138,999    123,680
  Taxes and licenses                     118,853    109,720    104,392
  Insurance and claims                    88,595     76,991     73,032
  Depreciation                           162,462    144,535    135,168
  Rent and purchased transportation      354,335    289,186    215,463
  Communications and utilities            20,468     18,919     16,480
  Other                                   (7,711)    (4,154)    (1,969)
                                      ---------- ---------- ----------
     Total operating expenses          1,807,236  1,536,715  1,340,262
                                      ---------- ---------- ----------

Operating income                         164,611    141,328    117,504
                                      ---------- ---------- ----------

Other expense (income):
  Interest expense                           672         13      1,099
  Interest income                         (3,381)    (2,580)    (1,699)
  Other                                      261        198        128
                                      ---------- ---------- ----------
     Total other income                   (2,448)    (2,369)      (472)
                                      ---------- ---------- ----------

Income before income taxes               167,059    143,697    117,976
Income taxes                              68,525     56,387     44,249
                                      ---------- ---------- ----------

Net income                            $   98,534 $   87,310 $   73,727
                                      ========== ========== ==========

Earnings per share:
  Basic                               $     1.24 $     1.10 $     0.92
                                      ========== ========== ==========
  Diluted                             $     1.22 $     1.08 $     0.90
                                      ========== ========== ==========

Weighted-average common shares
  outstanding:
  Basic                                   79,393     79,224     79,828
                                      ========== ========== ==========
  Diluted                                 80,701     80,868     81,668
                                      ========== ========== ==========



The accompanying notes are an integral part of these consolidated
financial statements.

                                29



                    WERNER ENTERPRISES, INC.
                   CONSOLIDATED BALANCE SHEETS
              (In thousands, except share amounts)



                                                                December 31,
                                                         --------------------------
                    ASSETS                                  2005            2004
                                                         ----------      ----------
                                                                   
Current assets:
  Cash and cash equivalents                              $   36,583      $  108,807
  Accounts receivable, trade, less allowance
    of $8,357 and $8,189, respectively                      240,224         186,771
  Other receivables                                          19,914          11,832
  Inventories and supplies                                   10,951           9,658
  Prepaid taxes, licenses, and permits                       18,054          15,292
  Current deferred income taxes                              20,940               -
  Other current assets                                       20,966          18,896
                                                         ----------      ----------
     Total current assets                                   367,632         351,256
                                                         ----------      ----------
Property and equipment, at cost:
  Land                                                       26,279          25,008
  Buildings and improvements                                110,275         105,493
  Revenue equipment                                       1,262,112       1,100,596
  Service equipment and other                               157,098         143,552
                                                         ----------      ----------
     Total property and equipment                         1,555,764       1,374,649
     Less - accumulated depreciation                        553,157         511,651
                                                         ----------      ----------
                 Property and equipment, net              1,002,607         862,998
                                                         ----------      ----------
Other non-current assets                                     15,523          11,521
                                                         ----------      ----------
                                                         $1,385,762      $1,225,775
                                                         ==========      ==========

     LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable                                       $   52,387      $   49,618
  Current portion of long-term debt                          60,000               -
  Insurance and claims accruals                              62,418          55,095
  Accrued payroll                                            21,274          19,579
  Current deferred income taxes                                   -          15,569
  Other current liabilities                                  21,838          17,705
                                                         ----------      ----------
     Total current liabilities                              217,917         157,566
                                                         ----------      ----------
Other long-term liabilities                                     526             301
Deferred income taxes                                       209,868         210,739
Insurance and claims accruals, net of current
  portion                                                    95,000          84,000
Commitments and contingencies
Stockholders' equity:
  Common stock, $.01 par value, 200,000,000
    shares authorized; 80,533,536 shares
    issued; 79,420,443 and 79,197,747
    shares outstanding, respectively                            805             805
  Paid-in capital                                           105,074         106,695
  Retained earnings                                         777,260         691,035
  Accumulated other comprehensive loss                         (259)           (861)
  Treasury stock, at cost; 1,113,093 and
    1,335,789 shares, respectively                          (20,429)        (24,505)
                                                         ----------      ----------
     Total stockholders' equity                             862,451         773,169
                                                         ----------      ----------
                                                         $1,385,762      $1,225,775
                                                         ==========      ==========



The accompanying notes are an integral part of these consolidated
financial statements.

                                30



                    WERNER ENTERPRISES, INC.
              CONSOLIDATED STATEMENTS OF CASH FLOWS
                         (In thousands)




                                          Years Ended December 31,
                                     --------------------------------
                                         2005       2004       2003
                                     ---------- ---------- ----------
                                                    
Cash flows from operating activities:
  Net income                           $ 98,534   $ 87,310   $ 73,727
  Adjustments to reconcile net
    income to net cash provided by
    operating activities:
    Depreciation                        162,462    144,535    135,168
    Deferred income taxes               (37,380)    12,517     (5,480)
    Gain on disposal of operating
      equipment                         (11,026)    (9,735)    (7,557)
    Tax benefit from exercise of
      stock options                       1,617      3,225      2,863
    Other long-term assets                 (795)       408      1,023
    Insurance and claims accruals,
      net of current portion             11,000     13,000     23,500
    Other long-term liabilities             225          -          -
    Changes in certain working
      capital items:
      Accounts receivable, net          (53,453)   (34,310)   (20,572)
      Prepaid expenses and other
        current assets                  (14,207)    (4,261)     6,358
      Accounts payable                    2,769      8,715     (9,643)
      Accrued and other current
        liabilities                      12,746      5,178      8,087
                                     ---------- ---------- ----------
    Net cash provided by operating
      activities                        172,492    226,582    207,474
                                     ---------- ---------- ----------

Cash flows from investing activities:
  Additions to property and equipment  (414,112)  (294,288)  (158,351)
  Retirements of property and
    equipment                           114,903     98,098     54,754
  Decrease in notes receivable            4,957      2,703      2,052
                                     ---------- ---------- ----------
    Net cash used in investing
      activities                       (294,252)  (193,487)  (101,545)
                                     ---------- ---------- ----------

Cash flows from financing activities:
  Proceeds from issuance of short-
    term debt                            60,000          -          -
  Repayments of long-term debt                -          -    (20,000)
  Dividends on common stock             (11,904)    (9,506)    (6,466)
  Payment of stock split fractional
    shares                                    -          -         (9)
  Repurchases of common stock            (1,573)   (21,591)   (13,476)
  Stock options exercised                 2,411      5,424      6,167
                                     ---------- ---------- ----------
    Net cash provided by (used in)
      financing activities               48,934    (25,673)   (33,784)
                                     ---------- ---------- ----------
Effect of exchange rate fluctuations
  on cash                                   602        (24)      (621)
Net increase (decrease) in cash and
  cash equivalents:                     (72,224)     7,398     71,524

Cash and cash equivalents, beginning
  of year                               108,807    101,409     29,885
                                     ---------- ---------- ----------
Cash and cash equivalents, end of
  year                                 $ 36,583   $108,807   $101,409
                                     ========== ========== ==========
Supplemental disclosures of cash flow
  information:
  Cash paid during year for:
    Interest                           $    561   $     13   $  1,148
    Income taxes                         99,170     42,850     34,401
Supplemental disclosures of non-cash
  investing activities:
  Notes receivable issued upon sale
    of revenue equipment               $  8,164   $  4,079   $  2,566



The accompanying notes are an integral part of these consolidated
financial statements.

                                31



                     WERNER ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME
                             INCOME
       (In thousands, except share and per share amounts)



                                                                Accumulated
                                                                   Other                     Total
                                 Common   Paid-In   Retained   Comprehensive   Treasury   Stockholders'
                                 Stock    Capital   Earnings   Income (Loss)     Stock       Equity
                               --------------------------------------------------------------------------
                                                                          
BALANCE, December 31, 2002        $805   $107,366   $547,467      $(216)      $ (7,779)     $647,643

Purchases of 764,500 shares
  of common stock                    -          -          -          -        (13,476)      (13,476)
Dividends on common stock
  ($.090 per share)                  -          -     (7,183)         -              -        (7,183)
Payment of stock split
  fractional shares                  -         (9)         -          -              -            (9)
Exercise of stock options,
  752,591 shares, including
  tax benefits                       -      1,349          -          -          7,681         9,030
Comprehensive income (loss):
  Net income                         -          -     73,727          -              -        73,727
  Foreign currency translation
    adjustments                      -          -          -       (621)             -          (621)
                                  ----   --------   --------      -----       --------      --------
  Total comprehensive income
    (loss)                           -          -     73,727       (621)             -        73,106
                                  ----   --------   --------      -----       --------      --------

BALANCE, December 31, 2003         805    108,706    614,011       (837)       (13,574)      709,111

Purchases of 1,173,200 shares
  of common stock                    -          -          -          -        (21,591)      (21,591)
Dividends on common stock
  ($.130 per share)                  -          -    (10,286)         -              -       (10,286)
Exercise of stock options,
  656,676 shares, including
  tax benefits                       -     (2,011)         -          -         10,660         8,649
Comprehensive income (loss):
  Net income                         -          -     87,310          -              -        87,310
  Foreign currency translation
    adjustments                      -          -          -        (24)             -           (24)
                                  ----   --------   --------      -----       --------      --------
  Total comprehensive income
    (loss)                           -          -     87,310        (24)             -        87,286
                                  ----   --------   --------      -----       --------      --------

BALANCE, December 31, 2004         805    106,695    691,035       (861)       (24,505)      773,169

Purchases of 88,000 shares
  of common stock                    -          -          -          -         (1,573)       (1,573)
Dividends on common stock
  ($.155 per share)                  -          -    (12,309)         -              -       (12,309)
Exercise of stock options,
  310,696 shares, including
  tax benefits                       -     (1,621)         -          -          5,649         4,028
Comprehensive income (loss):
  Net income                         -          -     98,534          -              -        98,534
  Foreign currency translation
    adjustments                      -          -          -        602              -           602
                                  ----   --------   --------      -----       --------      --------

  Total comprehensive income
    (loss)                           -          -     98,534        602              -        99,136
                                  ----   --------   --------      -----       --------      --------

BALANCE, December 31, 2005        $805   $105,074   $777,260      $(259)      $(20,429)     $862,451
                                  ====   ========   ========      =====       ========      ========



The accompanying notes are an integral part of these consolidated
financial statements.

                                32




                    WERNER ENTERPRISES, INC.
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business

     Werner  Enterprises,  Inc. (the "Company")  is  a  truckload
transportation   and  logistics  company  operating   under   the
jurisdiction  of  the  U.S.  Department  of  Transportation,  the
Federal and Provincial Transportation Departments in Canada,  the
Secretary  of  Communication  and  Transportation  in Mexico, and
various  state  regulatory commissions. The Company  maintains  a
diversified freight base and is not dependent on a small group of
customers  or a specific industry for a majority of its  freight,
which   limits  concentrations  of  credit  risk.  One   customer
generated  approximately  10%  of total  revenues  for  2005  and
approximately 9% of total revenues for 2004 and 2003.

Principles of Consolidation

     The  accompanying  consolidated financial statements include
the  accounts  of Werner Enterprises, Inc. and its majority-owned
subsidiaries.   All   significant   intercompany   accounts   and
transactions relating to these majority-owned entities have  been
eliminated.

Use of Management Estimates

     The  preparation  of  consolidated financial  statements  in
conformity with accounting principles generally accepted  in  the
United  States  of America requires management to make  estimates
and  assumptions that affect the reported amounts of  assets  and
liabilities  and disclosure of contingent assets and  liabilities
at  the  date of the consolidated financial statements,  and  the
reported  amounts of revenues and expenses during  the  reporting
period. Actual results could differ from those estimates.

Cash and Cash Equivalents

     The  Company  considers   all   highly  liquid  investments,
purchased  with a maturity of three months or less,  to  be  cash
equivalents.

Trade Accounts Receivable

     Trade  accounts  receivable  are recorded  at  the  invoiced
amounts,  net  of  an  allowance  for  doubtful  accounts.    The
allowance for doubtful accounts is the Company's best estimate of
the  amount  of probable credit losses in the Company's  existing
accounts  receivable.  The financial condition  of  customers  is
reviewed  by  the Company prior to granting credit.  The  Company
determines the allowance based on historical write-off experience
and national economic data.  The Company reviews the adequacy  of
its allowance for doubtful accounts quarterly.  Past due balances
over   90   days  and  over  a  specified  amount  are   reviewed
individually  for collectibility.  Account balances  are  charged
off against the allowance after all means of collection have been
exhausted  and  the potential for recovery is considered  remote.
The  Company does not have any off-balance-sheet credit  exposure
related to its customers.

Inventories and Supplies

     Inventories  and  supplies  consist  primarily   of  revenue
equipment  parts,  tires,  fuel,  supplies,  and  company   store
merchandise and are stated at average cost.  Tires placed on  new
revenue  equipment  are capitalized as a part  of  the  equipment
cost. Replacement tires are expensed when placed in service.

                                33


Property, Equipment, and Depreciation

     Additions  and improvements  to property and  equipment  are
capitalized  at  cost, while maintenance and repair  expenditures
are  charged to operations as incurred.  Gains and losses on  the
sale  or  exchange of equipment are recorded in  other  operating
expenses.  Prior to July 1, 2005, if equipment was traded  rather
than sold and cash involved in the exchange was less than 25%  of
the  fair  value of the exchange, the cost of new  equipment  was
recorded  at  an  amount  equal to  the  lower  of  the  monetary
consideration paid plus the net book value of the traded property
or the fair value of the new equipment.

     Depreciation is calculated  based on the cost of the  asset,
reduced  by  its estimated salvage value, using the straight-line
method. Accelerated depreciation methods are used for income  tax
purposes. The lives and salvage values assigned to certain assets
for  financial reporting purposes are different than  for  income
tax  purposes.  For  financial  reporting  purposes,  assets  are
depreciated  using  the  following  estimated  useful  lives  and
salvage values:




                                         Lives         Salvage Values
                                       ----------     ----------------
                                                      
        Building and improvements       30 years             0%
        Tractors                         5 years            25%
        Trailers                        12 years             0%
        Service and other equipment    3-10 years            0%



     Although  the   Company's   normal   replacement  cycle  for
tractors  is  three  years, the Company  calculates  depreciation
expense  for financial reporting purposes using a five-year  life
and  25%  salvage value. Depreciation expense calculated in  this
manner   continues   at  the  same  straight-line   rate,   which
approximates  the continuing declining value of the tractors,  in
those  instances  in which a tractor is held  beyond  the  normal
three-year age.  Calculating depreciation expense using  a  five-
year  life  and  25%  salvage value results in  the  same  annual
depreciation  rate (15% of cost per year) and the same  net  book
value at the normal three-year replacement date (55% of cost)  as
using  a  three-year life and 55% salvage value.   As  a  result,
there  is  no  difference in recorded depreciation expense  on  a
quarterly or annual basis with the Company's five-year life,  25%
salvage  value  as  compared to a three-year  life,  55%  salvage
value.

Long-Lived Assets

     The  Company  reviews  its long-lived assets for  impairment
whenever  events  or changes in circumstances indicate  that  the
carrying amount of a long-lived asset may not be recoverable.  An
impairment loss would be recognized if the carrying amount of the
long-lived  asset  is not recoverable, and it  exceeds  its  fair
value.  For long-lived assets classified as held and used, if the
carrying  value of the long-lived asset exceeds the  sum  of  the
future  net cash flows, it is not recoverable.  The Company  does
not  separately identify assets by operating segment, as tractors
and  trailers are routinely transferred from one operating  fleet
to another.  As a result, none of the Company's long-lived assets
have   identifiable  cash  flows  from  use  that   are   largely
independent  of  the cash flows of other assets and  liabilities.
Thus, the asset group used to assess impairment would include all
assets of the Company.  Long-lived assets classified as held  for
sale  are  reported at the lower of its carrying amount  or  fair
value less costs to sell.

Insurance and Claims Accruals

     Insurance and claims  accruals, both current and noncurrent,
reflect  the  estimated cost for cargo loss  and  damage,  bodily
injury  and  property damage (BI/PD), group health, and  workers'
compensation  claims,  including estimated loss  development  and
loss adjustment expenses, not covered by insurance. The costs for
cargo  and  BI/PD insurance and claims are included in  insurance
and  claims expense, while the costs of group health and workers'
compensation claims are included in salaries, wages and  benefits
expense  in the Consolidated Statements of Income.  The insurance
and  claims  accruals  are  recorded at  the  estimated  ultimate
payment amounts and are based upon individual case estimates  and
estimates  of  incurred-but-not-reported losses based  upon  past
experience.   Actual costs related to insurance and  claims  have

                                34


not  differed materially from estimated accrued amounts  for  all
years presented.  The Company's insurance and claims accruals are
reviewed by an actuary every six months.

     The Company has been  responsible for liability claims up to
$500,000,  plus  administrative  expenses,  for  each  occurrence
involving  personal  injury or property damage  since  August  1,
1992.   For the policy year beginning August 1, 2004, the Company
increased  its  self-insured retention  ("SIR")  amount  to  $2.0
million  per  occurrence.  The Company is  also  responsible  for
varying  annual  aggregate amounts of  liability  for  claims  in
excess  of  the  self-insured  retention.   The  following  table
reflects the self-insured retention levels and aggregate  amounts
of liability for personal injury and property damage claims since
August 1, 2002:



                                                        Primary Coverage
        Coverage Period           Primary Coverage       SIR/deductible
------------------------------    ----------------     ------------------
                                                   
August 1, 2002 - July 31, 2003      $3.0 million         $500,000 (1)
August 1, 2003 - July 31, 2004      $3.0 million         $500,000 (2)
August 1, 2004 - July 31, 2005      $5.0 million         $2.0 million (3)
August 1, 2005 - July 31, 2006      $5.0 million         $2.0 million (4)




(1)  Subject to an additional $1.5 million aggregate in the  $0.5
to  $1.0 million  layer, a $1.0 million  aggregate in the $1.0 to
$2.0 million  layer, no  aggregate (i.e., fully insured)  in  the
$2.0 to $3.0 million layer, and self-insured in the $3.0 to  $5.0
million layer.

(2)  Subject to  an additional $1.5 million aggregate in the $0.5
to  $1.0 million  layer, a $1.0 million  aggregate in the $1.0 to
$2.0 million  layer, no  aggregate (i.e., fully  insured)  in the
$2.0  to $3.0 million layer, a $6.0 million aggregate in the $3.0
to $5.0 million  layer, and a $5.0 million  aggregate in the $5.0
to $10.0 million layer.

(3)  Subject  to an additional $3.0 million aggregate in the $2.0
to $3.0 million layer, no aggregate (i.e., fully insured) in  the
$3.0 to $5.0 million  layer, and a $5.0  million aggregate in the
$5.0 to $10.0 million layer.

(4)  Subject to an additional $2.0 million aggregate in the  $2.0
to $3.0 million layer, no aggregate (i.e., fully insured) in  the
$3.0 to $5.0 million  layer, and a  $5.0 million aggregate in the
$5.0 to $10.0 million layer.

     The  Company's   primary   insurance  covers  the  range  of
liability  where  the  Company  expects  most  claims  to  occur.
Liability  claims  substantially in excess  of  coverage  amounts
listed  in  the  table above, if they occur,  are  covered  under
premium-based  policies  with reputable  insurance  companies  to
coverage levels that management considers adequate.  The  Company
is   also  responsible  for  administrative  expenses  for   each
occurrence involving personal injury or property damage.

     The   Company   has  assumed   responsibility  for  workers'
compensation  up  to  $1.0  million  per  claim,  subject  to  an
additional $1.0 million aggregate for claims between $1.0 million
and  $2.0  million,  maintains  a $27.5  million  bond,  and  has
obtained insurance for individual claims above $1.0 million.

     Under  these insurance  arrangements, the Company  maintains
$37.2 million in letters of credit as of December 31, 2005.

Revenue Recognition

     The Consolidated Statements of Income reflect recognition of
operating  revenues  (including  fuel  surcharge  revenues)   and
related  direct  costs  when  the  shipment  is  delivered.   For
shipments  where  a third-party provider is utilized  to  provide
some or all of the service and the Company is the primary obligor
in  regards to the delivery of the shipment, establishes customer
pricing separately from carrier rate negotiations, generally  has
discretion  in carrier selection, and/or has credit risk  on  the
shipment, the Company records both revenues for the dollar  value
of  services billed by the Company to the customer and  rent  and
purchased  transportation expense for the costs of transportation
paid by the Company to the third-party provider upon delivery  of
the shipment.  In the absence of the conditions listed above, the
Company  records revenues net of expenses related to  third-party
providers.

                                35


Foreign Currency Translation

     Local  currencies are  generally considered  the  functional
currencies outside the United States.  Assets and liabilities are
translated  at  year-end exchange rates for operations  in  local
currency  environments.   Virtually  all  foreign  revenues   are
denominated  in  U.S. dollars.  Expense items are  translated  at
average  rates  of exchange prevailing during the year.   Foreign
currency  translation adjustments reflect the changes in  foreign
currency  exchange  rates applicable to the  net  assets  of  the
Mexican and Canadian operations for the years ended December  31,
2005, 2004, and 2003. The amounts of such translation adjustments
were   not   significant  for  all  years  presented   (see   the
Consolidated Statements of Stockholders' Equity and Comprehensive
Income).

Income Taxes

     The Company uses the asset and liability method of Statement
of  Financial Accounting Standards ("SFAS") No. 109 in accounting
for  income  taxes. Under this method, deferred  tax  assets  and
liabilities  are  recognized  for  the  future  tax  consequences
attributable  to  temporary  differences  between  the  financial
statement carrying amounts of existing assets and liabilities and
their  respective tax bases. Deferred tax assets and  liabilities
are  measured using the enacted tax rates expected  to  apply  to
taxable  income in the years in which those temporary differences
are expected to be recovered or settled.

Common Stock and Earnings Per Share

     The Company computes and presents earnings per share ("EPS")
in  accordance  with  SFAS  No. 128, Earnings  per  Share.  Basic
earnings  per  share is computed by dividing net  income  by  the
weighted-average number of common shares outstanding  during  the
period.   The  difference between basic and diluted earnings  per
share  for  all  periods presented is due  to  the  common  stock
equivalents  that are assumed to be issued upon the  exercise  of
stock  options. There are no differences in the numerator of  the
Company's  computations of basic and diluted EPS for  any  period
presented.   The  computation of basic and diluted  earnings  per
share is shown below (in thousands, except per share amounts).




                                     Years Ended December 31,
                                   ----------------------------
                                     2005      2004      2003
                                   --------  --------  --------
                                              
     Net income                    $ 98,534  $ 87,310  $ 73,727
                                   ========  ========  ========

     Weighted-average common shares
       outstanding                   79,393    79,224    79,828
     Common stock equivalents         1,308     1,644     1,840
                                   --------  --------  --------
     Shares used in computing        80,701    80,868    81,668
       diluted earnings per share  ========  ========  ========

     Basic earnings per share      $   1.24  $   1.10  $   0.92
                                   ========  ========  ========
     Diluted earnings per share    $   1.22  $   1.08  $   0.90
                                   ========  ========  ========



     Options  to  purchase  shares of  common  stock  which  were
outstanding during the periods indicated above, but were excluded
from  the  computation of diluted earnings per share because  the
option  purchase price was greater than the average market  price
of the common shares, were:




                                     Years Ended December 31,
                                   ----------------------------
                                     2005      2004      2003
                                   --------  --------  --------
                                                     
     Number of shares under option   19,500         -         -


     Option purchase price          $ 19.84         -         -



                                36


Stock Based Compensation

      At  December 31, 2005, the Company has a nonqualified stock
option  plan,  as described more fully in Note  5.   The  Company
applies the intrinsic value based method of Accounting Principles
Board  ("APB")  Opinion No. 25, Accounting for  Stock  Issued  to
Employees,  and  related interpretations in  accounting  for  its
stock option plan.  No stock-based employee compensation cost  is
reflected  in net income, as all options granted under  the  plan
had an exercise price equal to the market value of the underlying
common  stock on the date of grant.  The Company's pro forma  net
income  and  earnings per share (in thousands, except  per  share
amounts) would have been as indicated below had the fair value of
option  grants been charged to salaries, wages, and  benefits  in
accordance   with  SFAS  No.  123,  Accounting  for   Stock-Based
Compensation:




                                     Years Ended December 31,
                                   ----------------------------
                                     2005      2004      2003
                                   --------  --------  --------
                                              
     Net income, as reported       $ 98,534  $ 87,310  $ 73,727
     Less: Total stock-based
       employee compensation
       expense determined under
       fair value based method for
       all awards, net of related
       tax effects                    1,758     2,006     2,516
                                   --------  --------  --------
     Pro forma net income          $ 96,776  $ 85,304  $ 71,211
                                   ========  ========  ========


     Earnings per share:
       Basic - as reported         $   1.24  $  1.10   $   0.92
                                   ========  ========  ========
       Basic - pro forma           $   1.22  $  1.08   $   0.89
                                   ========  ========  ========
       Diluted - as reported       $   1.22  $  1.08   $   0.90
                                   ========  ========  ========
       Diluted - pro forma         $   1.20  $  1.05   $   0.87
                                   ========  ========  ========



     As  discussed  under  "Accounting  Standards",  the  Company
adopted SFAS 123(R) on January 1, 2006.

Comprehensive Income

     Comprehensive  income  consists  of  net  income  and  other
comprehensive  income (loss).  Other comprehensive income  (loss)
refers  to  revenues, expenses, gains, and losses  that  are  not
included  in  net  income, but rather are  recorded  directly  in
stockholders'  equity.  For the years ended  December  31,  2005,
2004,  and 2003, comprehensive income consists of net income  and
foreign currency translation adjustments.

Accounting Standards

     In  December 2004, the Financial Accounting Standards  Board
("FASB")  issued  SFAS No. 153, Exchanges of Nonmonetary  Assets.
This  Statement  amends  the guidance  in  APB  Opinion  No.  29,
Accounting  for  Nonmonetary Transactions.  APB  Opinion  No.  29
provided  an  exception to the basic measurement principle  (fair
value)  for  exchanges  of similar assets,  requiring  that  some
nonmonetary exchanges be recorded on a carryover basis.  SFAS No.
153  eliminates  the  exception to fair value  for  exchanges  of
similar   productive  assets  and  replaces  it  with  a  general
exception  for exchange transactions that do not have  commercial
substance, that is, transactions that are not expected to  result
in significant changes in the cash flows of the reporting entity.
The  provisions  of SFAS No. 153 are effective for  exchanges  of
nonmonetary  assets occurring in fiscal periods  beginning  after
June  15, 2005.  Management has determined that adoption of  this
standard  did  not  have  any material effect  on  the  financial
position, results of operations, and cash flows of the Company.

     In  December  2004, the FASB revised SFAS No.  123  (revised
2004),  Share-Based  Payments.  SFAS No.  123(R)  eliminates  the
alternative to use APB Opinion No. 25's intrinsic value method of
accounting (generally resulting in recognition of no compensation
cost)  and  instead  requires  a  company  to  recognize  in  its
financial  statements the cost of employee services  received  in

                                37


exchange  for valuable equity instruments issued, and liabilities
incurred, to employees in share-based payment transactions (e.g.,
stock  options).   The cost will be based on the grant-date  fair
value  of  the award and will be recognized over the  period  for
which an employee is required to provide service in exchange  for
the award.  In March 2005, the Securities and Exchange Commission
("SEC") issued Staff Accounting Bulletin ("SAB") 107, Share-Based
Payment,  which includes recognition, measurement and  disclosure
guidance  as  companies begin to implement SFAS No. 123(R).   SAB
107  does not modify any of the requirements of SFAS No.  123(R).
In  April  2005, the SEC adopted a rule deferring the  compliance
date  for  SFAS  No. 123(R) to the first annual reporting  period
that  begins after June 15, 2005. On adoption, the Company  would
recognize  compensation cost for the unvested portion  of  awards
granted  or modified after December 15, 1994 based on the  grant-
date fair value of those awards calculated under SFAS No. 123 (as
originally   issued)  for  either  recognition   or   pro   forma
disclosures  and for awards granted, modified, or  settled  after
adoption.  The Company adopted this standard on January 1,  2006,
and  it  will now report in its financial statements  the  share-
based  compensation  expense for reporting periods  beginning  in
2006.   As  of the date of this filing, management believes  that
adopting  the  new  standard  will  have  a  negative  impact  of
approximately  two cents per share for the year  ending  December
31,  2006,  representing the expense to  be  recognized  for  the
unvested  portion of awards granted to date, and  cannot  predict
the earnings impact of awards that may be granted in the future.

     In  May  2005,  the  FASB issued SFAS  No.  154,  Accounting
Changes  and  Error  Corrections.  This  Statement  replaces  APB
Opinion  No.  20, Accounting Changes, and SFAS No.  3,  Reporting
Accounting  Changes in Interim Financial Statements, and  changes
the  requirements  for the accounting for and  reporting  of  all
voluntary changes in accounting principle and changes required by
an  accounting  pronouncement when  the  pronouncement  does  not
include  specific transition provisions.  This Statement requires
retrospective application to prior periods' financial  statements
of changes in accounting principle, unless it is impracticable to
do  so.   The  provisions  of  SFAS No.  154  are  effective  for
accounting changes and corrections of errors made in fiscal years
beginning  after December 15, 2005.  SFAS No. 154  will  have  no
effect on the financial position, results of operations, and cash
flows  of  the  Company upon adoption, but  would  affect  future
changes in accounting principles.

(2)  LONG-TERM DEBT

     Long-term debt consisted of the following at December 31 (in
thousands):




                                             2005      2004
                                           --------  --------
                                               
       Notes payable to banks under
         committed credit facilities       $ 60,000  $      -
                                           --------  --------
                                             60,000         -
       Less current portion                  60,000         -
                                           --------  --------
       Long-term debt, net                 $      -  $      -
                                           ========  ========



     The notes payable to banks under committed credit facilities
bear  variable interest (4.8% at December 31, 2005) based on  the
London   Interbank  Offered  Rate  ("LIBOR"), and  these   credit
facilities  mature at various dates from October 2006 to  October
2007.   During January 2006, the Company repaid $35.0 million  on
these  notes.   As  of  December 31, 2005,  the  Company  has  an
additional  $65.0 million of available credit under these  credit
facilities with banks, which is further reduced by $37.2  million
in  letters  of credit the Company maintains.  Each of  the  debt
agreements require, among other things, that the Company maintain
a  minimum  consolidated  tangible net worth  and  not  exceed  a
maximum  ratio of total funded debt to earnings before  interest,
income  taxes, depreciation, amortization and rentals payable  as
defined  in  the credit facility.  The Company was in  compliance
with these covenants at December 31, 2005.

                                38


(3)  NOTES RECEIVABLE

     Notes  receivable are included  in other current assets  and
other non-current assets in the Consolidated Balance Sheets.   At
December  31,  notes receivable consisted of  the  following  (in
thousands):




                                              2005        2004
                                            --------    --------
                                                  
       Owner-operator notes receivable      $  9,627    $  7,006
       TDR Transportes, S.A. de C.V.           3,600       3,600
       Other notes receivable                  3,746       1,951
                                            --------    --------
                                              16,973      12,557
       Less current portion                    3,962       2,753
                                            --------    --------
       Notes receivable - non-current       $ 13,011    $  9,804
                                            ========    ========



     The   Company  provides   financing   to  some   independent
contractors  who want to become owner-operators by  purchasing  a
tractor  from the Company and leasing their truck to the Company.
At  December 31, 2005 and 2004, the Company had 246 and 221 notes
receivable   totaling   $9,627   and   $7,006   (in   thousands),
respectively,  from  these  owner-operators.   See  Note  7   for
information  regarding notes from related parties.   The  Company
maintains  a  first  security interest in the tractor  until  the
owner-operator  has paid the note balance in full.   The  Company
also  retains  recourse exposure related to  owner-operators  who
have   purchased  tractors  from  the  Company  with  third-party
financing arranged by the Company.

     During 2002, the Company loaned $3,600 (in thousands) to TDR
Transportes,  S.A. de C.V. ("TDR"), a truckload  carrier  in  the
Republic of Mexico.  The loan has a nine-year term with principal
payable  at  the  end of the term, is subject to acceleration  if
certain  conditions are met, bears interest at  a  rate  of  five
percent  per  annum which is payable quarterly, contains  certain
financial  and  other  covenants, and is  collateralized  by  the
assets of TDR.  The Company had a receivable for interest on this
note of $31 (in thousands) as of December 31, 2005 and 2004.  See
Note 7 for information regarding related party transactions.

(4)  INCOME TAXES

     Income   tax   expense  consisted   of  the   following  (in
thousands):



                                     2005           2004           2003
                                   --------       --------       --------
                                                        
      Current:
        Federal                    $ 93,715       $ 38,206       $ 46,072
        State                        12,190          5,664          3,657
                                   --------       --------       --------
                                    105,905         43,870         49,729
                                   --------       --------       --------
      Deferred:
        Federal                     (32,910)        12,336         (6,159)
        State                        (4,470)           181            679
                                   --------       --------       --------
                                    (37,380)        12,517         (5,480)
                                   --------       --------       --------
      Total income tax expense     $ 68,525       $ 56,387       $ 44,249
                                   ========       ========       ========



                                39


     The  effective  income  tax rate differs  from  the  federal
corporate  tax rate of 35% in 2005, 2004 and 2003 as follows  (in
thousands):




                                     2005           2004           2003
                                   --------       --------       --------
                                                        
      Tax at statutory rate        $ 58,471       $ 50,294       $ 41,292
      State  income taxes, net of
        federal tax benefits          5,018          3,800          2,818
      Non-deductible meals and
        entertainment                 4,340          2,670            172
      Income tax credits               (895)          (900)          (900)
      Other, net                      1,591            523            867
                                   --------       --------       --------
                                   $ 68,525       $ 56,387       $ 44,249
                                   ========       ========       ========



     At   December   31,  deferred  tax  assets  and  liabilities
consisted of the following (in thousands):




                                                2005          2004
                                              --------      --------
                                                      
        Deferred tax assets:
        Insurance and claims accruals         $ 59,870      $ 53,994
        Allowance for uncollectible accounts     4,216         3,813
        Other                                    4,588         4,584
                                              --------      --------
          Gross deferred tax assets             68,674        62,391
                                              --------      --------

        Deferred tax liabilities:
        Property and equipment                 244,128       242,139
        Prepaid expenses                         7,915        42,517
        Other                                    5,559         4,043
                                              --------      --------
          Gross deferred tax liabilities       257,602       288,699
                                              --------      --------
          Net deferred tax liability          $188,928      $226,308
                                              ========      ========



     These   amounts   (in  thousands)  are  presented   in   the
accompanying  Consolidated Balance Sheets as of  December  31  as
follows:




                                                2005          2004
                                              --------      --------
                                                      
        Current deferred tax asset            $ 20,940      $      -
        Current deferred tax liability               -        15,569
        Noncurrent deferred tax liability      209,868       210,739
                                              --------      --------
        Net deferred tax liability            $188,928      $226,308
                                              ========      ========



     The  Company  has not recorded a valuation allowance  as  it
believes that all deferred tax assets are more likely than not to
be   realized   as   a  result  of  the  Company's   history   of
profitability,  taxable  income  and  reversal  of  deferred  tax
liabilities.

(5)  STOCK OPTION AND EMPLOYEE BENEFIT PLANS

Stock Option Plan

     The Company's Stock Option Plan (the "Stock Option Plan") is
a  nonqualified plan that provides for the grant  of  options  to
management employees. Options are granted at prices equal to  the
market  value  of  the common stock on the  date  the  option  is
granted.

     Options granted become  exercisable in installments from six
to  seventy-two months after the date of grant. The  options  are
exercisable  over a period not to exceed ten years  and  one  day
from  the  date of grant. The maximum number of shares of  common

                                40


stock  that  may  be  optioned under the  Stock  Option  Plan  is
20,000,000 shares.  The maximum aggregate number of options  that
may  be granted to any one person under the Stock Option Plan  is
2,562,500 options.

     At  December 31, 2005, 8,845,861  shares were available  for
granting  additional  options. At December 31,  2005,  2004,  and
2003,  options  for  3,026,532, 2,485,582, and 2,183,597,  shares
with  weighted average exercise prices of $8.55, $8.48, and $8.45
were exercisable, respectively.

     The  following table  summarizes Stock Option Plan  activity
for the three years ended December 31, 2005:




                                         Options Outstanding
                                    ----------------------------
                                                Weighted-Average
                                      Shares     Exercise Price
                                    ----------------------------
                                              
     Balance, December 31, 2002     6,137,460       $  8.52
       Options granted                      -             -
       Options exercised             (752,591)         8.19
       Options canceled              (110,022)         7.84
                                    ---------
     Balance, December 31, 2003     5,274,847          8.58
       Options granted                787,000         18.33
       Options exercised             (656,676)         8.26
       Options canceled              (448,042)         8.79
                                    ---------
     Balance, December 31, 2004     4,957,129         10.16
       Options granted                415,500         16.95
       Options exercised             (310,696)         7.76
       Options canceled               (33,385)        14.80
                                    ---------
     Balance, December 31, 2005     5,028,548         10.83
                                    =========


     The  following  table  summarizes information  about  stock
options outstanding and exercisable at December 31, 2005:





                                      Options Outstanding            Options Exercisable
                               ---------------------------------------------------------------
                               Weighted-Average  Weighted-Average             Weighted-Average
     Range of        Number       Remaining          Exercise      Number         Exercise
 Exercise Prices  Outstanding  Contractual Life        Price     Exercisable        Price
----------------------------------------------------------------------------------------------
                                                                    
$ 6.28 to $ 7.95   1,916,182      4.3 years           $ 7.59      1,687,428        $ 7.57
$ 8.96 to $ 9.77   1,889,645      5.3 years             9.75      1,296,967          9.74
$10.43 to $13.94      46,721      3.5 years            11.28         42,137         10.99
$16.68 to $19.84   1,176,000      8.9 years            17.84              -             -
                  ----------                                     ----------
                   5,028,548      5.7 years            10.83      3,026,532          8.55
                  ==========                                     ==========



     The Company applies the  intrinsic value based method of APB
Opinion No. 25 and related interpretations in accounting for  its
Stock  Option  Plan.  SFAS  No. 123, Accounting  for  Stock-Based
Compensation  requires pro forma disclosure  of  net  income  and
earnings per share had the estimated fair value of option  grants
on their grant date been charged to salaries, wages and benefits.
The  fair  value of the options granted during 2005 and 2004  was
estimated using the Black-Scholes option-pricing model  with  the
following assumptions: risk-free interest rate of 4.1 percent  in
2005  and 4.0 percent in 2004; dividend yield of 0.94 percent  in
2005 and 0.66 percent in 2004; expected life of 4.8 years in 2005
and  6.5 years in 2004; and volatility of 36 percent in 2005  and
37  percent in 2004.  The weighted-average fair value of  options
granted  during  2005  and 2004 was $5.86 and  $7.60  per  share,
respectively.  The table in Note 1 illustrates the effect on  net
income and earnings per share had the fair value of option grants
been  charged  to  salaries, wages and benefits  expense  in  the
accompanying Consolidated Statements of Income.

                                41


Employee Stock Purchase Plan

     Employees  meeting  certain  eligibility   requirements  may
participate  in the Company's Employee Stock Purchase  Plan  (the
"Purchase  Plan"). Eligible participants designate the amount  of
regular  payroll deductions and/or single annual payment, subject
to  a  yearly maximum amount, that is used to purchase shares  of
the Company's common stock on the Over-The-Counter Market subject
to  the  terms  of the Purchase Plan. The Company contributes  an
amount equal to 15% of each participant's contributions under the
Purchase  Plan.  Company contributions for the Purchase Plan  (in
thousands)  were $119, $108, and $102 for 2005, 2004,  and  2003,
respectively. Interest accrues on Purchase Plan contributions  at
a  rate  of  5.25%.  The broker's commissions and  administrative
charges  related to purchases of common stock under the  Purchase
Plan are paid by the Company.

401(k) Retirement Savings Plan

     The Company has an Employees' 401(k) Retirement Savings Plan
(the "401(k) Plan"). Employees are eligible to participate in the
401(k)  Plan  if  they have been continuously employed  with  the
Company  or its subsidiaries for six months or more. The  Company
matches a portion of the amount each employee contributes to  the
401(k)  Plan.  It  is  the  Company's  intention,  but  not   its
obligation,  that  the  Company's total annual  contribution  for
employees  will  equal  at  least 2 1/2  percent  of  net  income
(exclusive of extraordinary items).  Salaries, wages and benefits
expense  in  the accompanying Consolidated Statements  of  Income
includes  Company  401(k) Plan contributions  and  administrative
expenses  (in thousands) of $2,268, $2,043, and $1,711 for  2005,
2004, and 2003, respectively.

(6)  COMMITMENTS AND CONTINGENCIES

     The  Company  has  committed   to   property  and  equipment
purchases, net of trades, of approximately $33.1 million.

     The  Company  is  involved in  certain  claims  and  pending
litigation  arising in the normal course of business.  Management
believes the ultimate resolution of these matters will not have a
material effect on the consolidated financial statements  of  the
Company.

(7)  RELATED PARTY TRANSACTIONS

     The Company leases land  from a trust in which the Company's
principal  stockholder  is  the sole trustee,  with  annual  rent
payments of $1 per year.  The Company is responsible for all real
estate taxes and maintenance costs related to the property, which
are recorded as expenses in the Company's Consolidated Statements
of  Income.  The Company has made leasehold improvements  to  the
land totaling approximately $6.1 million for facilities used  for
business meetings and customer promotion.

     The Company's principal  stockholder was the sole trustee of
a  trust  that  owned  a one-third interest  in  an  entity  that
operates  a  motel located nearby one of the Company's  terminals
with  which the Company has committed to rent a guaranteed number
of rooms.  The trust  assigned  its one-third  interest  in  this
entity to the Company at a nominal cost in February 2005.  During
2005, 2004, and 2003, the Company paid (in thousands) $945, $840,
and $732, respectively, for lodging services for  its drivers  at
this  motel.  On June 30,  2005, the  Company  sold .783 acres of
land to  this  entity  for  approximately  $90 (in thousands), in
accordance  with  the  exercise   of  a  purchase  option  clause
contained in a separate agreement entered into by the Company and
the  entity  in  April  2000.  The  Company  realized  a  gain of
approximately  $35 (in thousands)  on  the transaction.

     The  brother  and sister-in-law  of the Company's  principal
stockholder own an entity with a fleet of tractors that  operates
as  an  owner-operator for the Company.  During 2005,  2004,  and
2003, the Company paid (in thousands) $6,291, $6,200, and $5,888,
respectively, to this owner-operator for purchased transportation
services.   This  fleet  is compensated  using  the  same  owner-
operator  pay  package as the Company's other  comparable  third-
party  owner-operators.  The  Company  also  sells  used  revenue

                                42


equipment  to  this entity.  During 2005, 2004, and  2003,  these
sales   (in   thousands)   totaled  $1,019,   $193,   and   $292,
respectively, and the Company recognized gains (in thousands)  of
$130,  $18,  and $55 in 2005, 2004, and 2003, respectively.   The
Company  had 32 and 35 notes receivable from this entity  related
to the revenue equipment sales (in thousands) totaling $1,105 and
$656 at December 31, 2005 and 2004, respectively.

     The brother of the Company's principal stockholder has a 50%
ownership  interest in an entity with a fleet  of  tractors  that
operates  as an owner-operator for the Company.  During 2005  and
2004,   the   Company  paid   (in  thousands)  $476   and   $453,
respectively  to this owner-operator for purchased transportation
services.   This  fleet  is compensated  using  the  same  owner-
operator  pay  package as the Company's other  comparable  third-
party owner-operators.

     The  Company and TDR transact business with  each other  for
certain  of  their purchased transportation needs.  During  2005,
2004,  and  2003,  the  Company recorded operating  revenues  (in
thousands)  from  TDR  of approximately  $227,  $168,  and  $206,
respectively, and recorded purchased transportation  expense  (in
thousands)  to  TDR  of  approximately $521,  $631,  and  $1,099,
respectively.   In  addition, during 2005, 2004,  and  2003,  the
Company  recorded operating revenues (in thousands) from  TDR  of
approximately  $3,582, $2,837, and $1,495, respectively,  related
to the leasing of revenue equipment.  As of December 31, 2005 and
2004, the Company had receivables related to the equipment leases
(in  thousands) of $2,389 and $1,351, respectively.  The  Company
also  sells used revenue equipment to this entity.  During  2005,
these   sales  (in  thousands)  totaled  $358,  and  the  Company
recognized gains (in thousands) of $19 in 2005.  See Note  3  for
information regarding the note receivable from TDR.

     The  Company  has  a  5%  ownership interest  in  Transplace
("TPC"),  a  logistics joint venture of five large transportation
companies.  The Company and TPC enter into transactions with each
other  for  certain of their purchased transportation needs.  The
Company  recorded operating revenue (in thousands)  from  TPC  of
approximately  $4,800, $8,400, and $16,800  in  2005,  2004,  and
2003, respectively, and recorded purchased transportation expense
(in  thousands) to TPC of approximately $0, $7, and  $711  during
2005, 2004, and 2003, respectively.

     The Company believes that these transactions are on terms no
less  favorable to the Company than those that could be  obtained
from unrelated third parties on an arm's length basis.

(8)  SEGMENT INFORMATION

     The  Company  has   two   reportable  segments  -  Truckload
Transportation Services and Value Added Services.  The  Truckload
Transportation Services segment consists of six  operating fleets
that  have  been  aggregated  since they  have  similar  economic
characteristics and meet the other aggregation criteria  of  SFAS
No.  131. The medium-to-long-haul Van fleet transports a  variety
of   consumer,  nondurable  products  and  other  commodities  in
truckload  quantities  over  irregular  routes  using   dry   van
trailers.   The  Regional  Short-Haul fleet  provides  comparable
truckload  van  service  within  five  geographic  regions.   The
Dedicated Services fleet provides truckload services required  by
a  specific company, plant, or distribution center.  The  Flatbed
and  Temperature-Controlled fleets provide truckload services for
products with specialized trailers.  The Expedited fleet provides
time-sensitive truckload services utilizing driver teams.

     The  Value  Added  Services  segment,  which  generates  the
majority of the Company's non-trucking revenues, provides freight
brokerage, intermodal services, multimodal services, and  freight
transportation management.

     The Company generates  other revenues related to third-party
equipment  maintenance,  equipment leasing,  and  other  business
activities.  None  of  these  operations  meet  the  quantitative
threshold  reporting requirements of SFAS No. 131. As  a  result,
these  operations are grouped in "Other" in the table below.  The
Company does not prepare separate balance sheets by segment  and,
as  a  result, assets are not separately identifiable by segment.
The  Company  has  no significant intersegment sales  or  expense
transactions  that  would  result  in  adjustments  necessary  to
eliminate amounts between the Company's segments.

                                43


     The  following   tables   summarize  the  Company's  segment
information (in thousands):




                                                            Revenues
                                                            --------
                                              2005            2004            2003
                                           ----------      ----------      ----------
                                                                  
     Truckload Transportation Services     $1,741,828      $1,506,937      $1,358,428
     Value Added Services                     218,620         161,111          89,742
     Other                                      7,777           6,424           5,287
     Corporate                                  3,622           3,571           4,309
                                           ----------      ----------      ----------
     Total                                 $1,971,847      $1,678,043      $1,457,766
                                           ==========      ==========      ==========






                                                         Operating Income
                                                         ----------------
                                               2005            2004            2003
                                            ----------      ----------      ----------
                                                                   
     Truckload Transportation Services      $  156,122      $  135,828      $  118,146
     Value Added Services                        8,445           5,631             454
     Other                                       2,850           2,587           1,236
     Corporate                                  (2,806)         (2,718)         (2,332)
                                            ----------      ----------      ----------
     Total                                  $  164,611      $  141,328      $  117,504
                                            ==========      ==========      ==========



      Information  as to the Company's operations  by  geographic
area is summarized below (in thousands).  Operating revenues  for
Mexico  and Canada include revenues for shipments with an  origin
or  destination  in that country and other services  provided  in
that country.




                                                             Revenues
                                                             --------
                                               2005            2004            2003
                                            ----------      ----------      ----------
                                                                   
     United States                          $1,782,501      $1,537,745      $1,349,153
                                            ----------      ----------      ----------

     Foreign countries
       Canada                                   43,668          35,364          30,886
       Mexico                                  145,678         104,934          77,727
                                            ----------      ----------      ----------
          Total foreign countries              189,346         140,298         108,613
                                            ----------      ----------      ----------
     Total                                  $1,971,847      $1,678,043      $1,457,766
                                            ==========      ==========      ==========






                                                        Long-lived Assets
                                                        -----------------
                                               2005            2004            2003
                                            ----------      ----------      ----------
                                                                   
     United States                          $  990,439      $  850,250      $  796,627
                                            ----------      ----------      ----------

     Foreign countries
       Canada                                      301             136             142
       Mexico                                   11,867          12,612           8,918
                                            ----------      ----------      ----------
          Total foreign countries               12,168          12,748           9,060
                                            ----------      ----------      ----------
     Total                                  $1,002,607      $  862,998      $  805,687
                                            ==========      ==========      ==========


     Substantially  all of the Company's revenues  are  generated
within  the  United States or from North American shipments  with
origins  or  destinations  in  the United  States.  One  customer
generated  approximately 10% of the Company's total revenues  for
2005 and approximately 9% of total revenues for 2004 and 2003.

                                44


(9)  QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

(In thousands, except per share amounts)




                             First       Second        Third       Fourth
                            Quarter      Quarter      Quarter      Quarter
2005:                      ------------------------------------------------
                                                      
Operating revenues         $ 455,262    $ 485,789    $ 504,520    $ 526,276
Operating income              32,837       42,128       41,138       48,508
Net income                    19,921       25,295       24,491       28,827
Basic earnings per share         .25          .32          .31          .36
Diluted earnings per share       .25          .31          .30          .36


                             First       Second        Third       Fourth
                            Quarter      Quarter      Quarter      Quarter
2004:                      ------------------------------------------------
Operating revenues         $ 386,280    $ 411,115    $ 425,409    $ 455,239
Operating income              24,859       34,991       39,510       41,968
Net income                    15,568       21,620       24,299       25,823
Basic earnings per share         .20          .27          .31          .33
Diluted earnings per share       .19          .27          .30          .32




ITEM 9.   CHANGES  IN  AND  DISAGREEMENTS   WITH  ACCOUNTANTS  ON
          ACCOUNTING AND FINANCIAL DISCLOSURE

     No  reports under this item have been required to  be  filed
within the two most recent fiscal years ended December 31,  2005,
involving  a change of accountants or disagreements on accounting
and financial disclosure.

ITEM 9A.  CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

     As  of  the  end  of the period covered by this report,  the
Company carried out an evaluation, under the supervision and with
the  participation  of  the Company's management,  including  the
Company's Chief Executive Officer and Chief Financial Officer, of
the  effectiveness of the design and operation of  the  Company's
disclosure  controls and procedures, as defined in  Exchange  Act
Rule  15d-15(e). Based upon that evaluation, the Company's  Chief
Executive Officer and Chief Financial Officer concluded that  the
Company's  disclosure controls and procedures  are  effective  in
enabling  the  Company to record, process, summarize  and  report
information required to be included in the Company's periodic SEC
filings within the required time period.

Management's Report on Internal Control over Financial Reporting

     Management  is responsible  for establishing and maintaining
adequate  internal  control  over  financial  reporting  for  the
Company.  Internal control over financial reporting is a  process
designed to  provide  reasonable  assurance  to   the   Company's
management  and  board of directors regarding the reliability  of
financial  reporting and the preparation of financial  statements
for  external purposes in accordance with U.S. generally accepted
accounting principles.  Internal control over financial reporting
includes maintaining records that in reasonable detail accurately
and   fairly   reflect  the  Company's  transactions;   providing
reasonable assurance that transactions are recorded as  necessary
for preparation of our financial statements; providing reasonable
assurance  that receipts and expenditures of company  assets  are
made  in  accordance with management authorization; and providing
reasonable  assurance  that  unauthorized  acquisition,  use   or
disposition  of  the company assets that could  have  a  material
effect  on  the Company's financial statements would be prevented
or  detected on a timely basis.

                                45


     Because  of its inherent limitations, internal control  over
financial  reporting  may  not prevent or  detect  misstatements.
Also,  projections of any evaluation of effectiveness  to  future
periods  are  subject  to  the  risk  that  controls  may  become
inadequate  because of changes in conditions, or that the  degree
of compliance with the policies or procedures may deteriorate.

     Management  has assessed the effectiveness of the  Company's
internal  control  over financial reporting as  of  December  31,
2005,  based  on  the  criteria for  effective  internal  control
described  in Internal Control - Integrated Framework  issued  by
the   Committee  of  Sponsoring  Organizations  of  the  Treadway
Commission.   Based on its assessment, management concluded  that
the  Company's  internal  control over  financial  reporting  was
effective as of December 31, 2005.

     Management has  engaged KPMG LLP, the independent registered
public  accounting  firm that audited the consolidated  financial
statements included in this Annual Report on Form 10-K, to attest
to  and  report  on  management's  evaluation  of  the  Company's
internal  control  over  financial  reporting.   Its  report   is
included herein.

Report of Independent Registered Public Accounting Firm

The Stockholders and Board of Directors
Werner Enterprises, Inc.:

     We  have  audited management's assessment, included  in  the
accompanying   Management's  Report  on  Internal  Control   over
Financial  Reporting,  that Werner Enterprises,  Inc.  maintained
effective  internal  control  over  financial  reporting  as   of
December  31,  2005,  based on criteria established  in  Internal
Control-Integrated   Framework  issued  by   the   Committee   of
Sponsoring  Organizations  of  the  Treadway  Commission  (COSO).
Werner   Enterprises,  Inc.'s  management  is   responsible   for
maintaining  effective internal control over financial  reporting
and  for  its assessment of the effectiveness of internal control
over  financial reporting. Our responsibility is  to  express  an
opinion  on  management's  assessment  and  an  opinion  on   the
effectiveness  of the Company's internal control  over  financial
reporting based on our audit.

     We  conducted our audit in accordance with the standards  of
the  Public  Company Accounting Oversight Board (United  States).
Those  standards require that we plan and perform  the  audit  to
obtain  reasonable  assurance about  whether  effective  internal
control  over financial reporting was maintained in all  material
respects.  Our  audit  included  obtaining  an  understanding  of
internal    control   over   financial   reporting,    evaluating
management's  assessment, testing and evaluating the  design  and
operating effectiveness of internal control, and performing  such
other procedures as we considered necessary in the circumstances.
We  believe  that our audit provides a reasonable basis  for  our
opinion.

     A  company's internal control over financial reporting is  a
process  designed to provide reasonable assurance  regarding  the
reliability  of  financial  reporting  and  the  preparation   of
financial  statements for external purposes  in  accordance  with
generally  accepted  accounting principles. A company's  internal
control  over  financial reporting includes  those  policies  and
procedures  that (1) pertain to the maintenance of records  that,
in   reasonable  detail,  accurately  and  fairly   reflect   the
transactions  and dispositions of the assets of the company;  (2)
provide  reasonable assurance that transactions are  recorded  as
necessary  to  permit  preparation  of  financial  statements  in
accordance  with  generally accepted accounting  principles,  and
that receipts and expenditures of the company are being made only
in  accordance with authorizations of management and directors of
the  company;  and  (3)  provide reasonable  assurance  regarding
prevention or timely detection of unauthorized acquisition,  use,
or disposition of the company's assets that could have a material
effect on the financial statements.

     Because  of its inherent limitations, internal control  over
financial  reporting  may  not prevent or  detect  misstatements.
Also,  projections of any evaluation of effectiveness  to  future
periods  are  subject  to  the  risk  that  controls  may  become

                                46


inadequate  because of changes in conditions, or that the  degree
of compliance with the policies or procedures may deteriorate.

     In   our   opinion,  management's  assessment  that   Werner
Enterprises,  Inc.  maintained effective  internal  control  over
financial reporting as of December 31, 2005, is fairly stated, in
all  material  respects, based on COSO.  Also,  in  our  opinion,
Werner  Enterprises, Inc. maintained, in all  material  respects,
effective  internal  control  over  financial  reporting  as   of
December 31, 2005, based on COSO.

     We  also  have audited, in accordance with the standards  of
the  Public  Company Accounting Oversight Board (United  States),
the  consolidated balance sheets of Werner Enterprises, Inc.  and
subsidiaries  as of December 31, 2005 and 2004, and  the  related
consolidated  statements  of  income,  stockholders'  equity  and
comprehensive income, and cash flows for each of the years in the
three-year  period ended December 31, 2005, and our report  dated
February  1,  2006,  expressed an unqualified  opinion  on  those
consolidated financial statements.

                              KPMG LLP
Omaha, Nebraska
February 1, 2006

Changes in Internal Control over Financial Reporting

     There  were  no changes  in the Company's internal  controls
over  financial reporting that occurred during the quarter  ended
December  31,  2005,  that  have  materially  affected,  or   are
reasonably  likely  to materially affect, the Company's  internal
control over financial reporting.

ITEM 9B.  OTHER INFORMATION

     The  following disclosure  is provided pursuant to Item 5.02
of  Form  8-K.  On February 9, 2006, Mr. Jeffrey G. Doll notified
the  Board of Directors (the "Board") of Werner Enterprises, Inc.
(the "Company") of his intention to not stand for re-election  at
the  2006 Annual Meeting of Stockholders on May 9, 2006. Mr. Doll
will  remain  on the Board through the expiration of his  current
term  at  the 2006 Annual Meeting.  Mr. Doll is the Lead  Outside
Director   and  also  serves  on  the  Audit  Committee,   Option
Committee,   Executive  Compensation  Committee,  and  Nominating
Committee.  The Board intends to submit a qualified candidate for
election at the 2006 Annual Meeting of Stockholders to fill  this
vacancy.

                            PART III

     Certain  information  required by Part III is  omitted  from
this  report  on  Form  10-K in that  the  Company  will  file  a
definitive  proxy  statement pursuant to Regulation  14A  ("Proxy
Statement") not later than 120 days after the end of  the  fiscal
year covered by this report on Form 10-K, and certain information
included therein is incorporated herein by reference.  Only those
sections  of  the Proxy Statement which specifically address  the
items  set  forth  herein are incorporated  by  reference.   Such
incorporation does not include the Compensation Committee  Report
or the Performance Graph included in the Proxy Statement.

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The information required by this Item, with the exception of
the  Code  of Ethics discussed below, is incorporated  herein  by
reference to the Company's Proxy Statement.

                                47


Code of Ethics

     The Company has adopted a code of ethics that applies to its
principal   executive  officer,  principal   financial   officer,
principal  accounting officer/controller, and all other officers,
employees, and directors.  The code of ethics is available on the
Company's website, www.werner.com.  The Company intends  to  post
on  its website any material changes to, or waiver from, its code
of ethics, if any, within four business days of any such event.

ITEM 11.  EXECUTIVE COMPENSATION

     The information required by this Item is incorporated herein
by reference to the Company's Proxy Statement.

ITEM 12.  SECURITY OWNERSHIP OF  CERTAIN  BENEFICIAL  OWNERS  AND
          MANAGEMENT

     The information required by this Item, with the exception of
the  equity  compensation plan information  presented  below,  is
incorporated   herein  by  reference  to  the   Company's   Proxy
Statement.

Equity Compensation Plan Information

     The  following table  summarizes, as of December  31,  2005,
information   about   compensation  plans  under   which   equity
securities of the Company are authorized for issuance:



                                                                         Number of Securities
                                                                       Remaining Available for
                                                                        Future Issuance under
                     Number of Securities to     Weighted-Average        Equity Compensation
                     be Issued upon Exercise    Exercise Price of         Plans (Excluding
                     of Outstanding Options,   Outstanding Options,    Securities Reflected in
                       Warrants and Rights     Warrants and Rights           Column (a))
Plan Category                 (a)                      (b)                       (c)
-------------        -----------------------   --------------------    -----------------------
                                                                     
Equity compensation
  plans approved by
  security holders          5,028,548                 $10.83                  8,845,861



     The Company does not have any equity compensation plans that
were not approved by security holders.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The information required by this Item is incorporated herein
by reference to the Company's Proxy Statement.

ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES

     The information required by this Item is incorporated herein
by reference to the Company's Proxy Statement.

                                48


                             PART IV

ITEM 15.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)  Financial Statements and Schedules.

     (1)  Financial Statements:  See Part II, Item 8 hereof.
                                                                        Page
                                                                        ----
          Report of Independent Registered Public Accounting Firm        28
          Consolidated Statements of Income                              29
          Consolidated Balance Sheets                                    30
          Consolidated Statements of Cash Flows                          31
          Consolidated Statements of Stockholders' Equity and
            Comprehensive Income                                         32
          Notes to Consolidated Financial Statements                     33

     (2)  Financial  Statement   Schedules:    The   consolidated
financial  statement  schedule  set  forth  under  the  following
caption  is  included  herein.  The  page  reference  is  to  the
consecutively numbered pages of this report on Form 10-K.
                                                                        Page
                                                                        ----
          Schedule II - Valuation and Qualifying Accounts                51

          Schedules  not listed above have been  omitted  because
they  are  not applicable or are not required or the  information
required  to be set forth therein is included in the Consolidated
Financial Statements or Notes thereto.

     (3)  Exhibits:  The  response to this portion of Item 15  is
submitted as a separate section of this report on Form 10-K  (see
Exhibit Index on page 52).

                                49


SIGNATURES

      Pursuant to the requirements of Section 13 or 15(d) of  the
Securities  Exchange Act of 1934, the registrant has duly  caused
this  report  to  be  signed on its behalf  by  the  undersigned,
thereunto duly authorized, on the 15th day of February, 2006.


                              WERNER ENTERPRISES, INC.


                         By:  /s/ James L. Johnson
                              -----------------------------------
                              James L. Johnson
                              Senior Vice President, Controller
                              and Corporate Secretary


                                50


                           SCHEDULE II

                    WERNER ENTERPRISES, INC.


                VALUATION AND QUALIFYING ACCOUNTS
                         (In thousands)





                                    Balance at    Charged to    Write-off     Balance at
                                   Beginning of   Costs and    of Doubtful      End of
                                      Period       Expenses      Accounts       Period
                                   ------------   ----------   -----------    ----------

                                                                    
  Year ended December 31, 2005:
  Allowance for doubtful accounts     $8,189        $  962        $  794        $8,357
                                   ============   ==========   ===========    ==========

  Year ended December 31, 2004:
  Allowance for doubtful accounts     $6,043        $2,255        $  109        $8,189
                                   ============   ==========   ===========    ==========

  Year ended December 31, 2003:
  Allowance for doubtful accounts     $4,459        $1,914        $  330        $6,043
                                   ============   ==========   ===========    ==========



See report of independent registered public accounting firm.

                                51




                          EXHIBIT INDEX





  Exhibit
  Number              Description                     Page Number or Incorporated by Reference to
  -------             -----------                     -------------------------------------------
                                              
  3(i)(A)   Revised and Amended Articles of         Filed herewith *
            Incorporation

  3(i)(B)   Articles of Amendment to Articles of    Exhibit 3(i) to the Company's report on Form 10-
            Incorporation                           Q for the quarter ended May 31, 1994

  3(i)(C)   Articles of Amendment to Articles of    Exhibit 3(i) to the Company's report on Form 10-
            Incorporation                           K for the year ended December 31, 1998

  3(i)(D)   Articles of Amendment to Articles of    Exhibit 3(i)(D) to the Company's report on Form
            Incorporation                           10-Q for the quarter ended June 30, 2005

  3(ii)     Revised and Amended By-Laws             Exhibit 3(ii) to the Company's report on Form 10-
                                                    Q for the quarter ended June 30, 2004

  10.1      Amended and Restated Stock Option Plan  Exhibit 10.1 to the Company's report on Form 10-
                                                    Q for the quarter ended June 30, 2004

  10.2      Non-Employee Director Compensation      Exhibit 10.1 to the Company's report on Form 10-
                                                    Q for the quarter ended June 30, 2005

  10.3      The Executive Nonqualified Excess Plan  Exhibit 10.1 to the Company's report on Form 10-
            of Werner Enterprises, Inc.             Q for the quarter ended September 30, 2005


  10.4      Named Executive Officer Compensation    Filed herewith *

  11        Statement Re: Computation of Per Share  See Note 1 "Common Stock and Earnings Per
            Earnings                                Share" in the Notes to Consolidated Financial
                                                    Statements under Item 8

  21        Subsidiaries of the Registrant          Filed herewith *

  23.1      Consent of KPMG LLP                     Filed herewith *

  31.1      Rule 13a-14(a)/15d-14(a) Certification  Filed herewith **

  31.2      Rule 13a-14(a)/15d-14(a) Certification  Filed herewith **

  32.1      Section 1350 Certification              Filed herewith **

  32.2      Section 1350 Certification              Filed herewith **



*  Filed with the Original Report on February 14, 2006.
** Filed with this Amendment No. 1 on Form 10-K/A.

                                52